Preamble

The House met at a Quarter before Three of the Clock, Mr. SPEAKER in the Chair.

PRIVATE BUSINESS.

London County Council (Money) Bill,

Read the Third time, and passed.

Oakham Gas and Electricity Bill [Lords],

Read the Third Time, and passed, with Amendments.

Torquay Corporation Bill,

Read the Third time, and passed.

Shropshire, Worcestershire, and Staffordshire Electric Power Bill [Lords],

Read a Second time, and committed.

Oyster and Mussel Fishery (Seasalter and Ham) Provisional Order Bill (by Order,

Third Reading deferred till Friday.

Glasgow Corporation Order Confirmation Bill [Lords] (by Order),

Considered; to be read the Third time To-morrow.

PUBLIC WORKS LOANS,

Copy ordered, "of Statement, of particulars of Loans of which the balances outstanding are proposed to be remitted or written off, in whole or in part, from the assets of the Local Loans Fund (in continuation of Parliamentary Paper, No. 113, of Session I, 1922)".—[Sir William Joynson-Hicks.]

EXPERIMENTS ON LIVING ANIMALS,

Address for "Return showing the number of Experiments on Living Animals during the year 1922 under licences granted under the Act 39 and 40 Vic., c. 77, distinguishing the nature of the Experiments (in continuation of Parliamentary Paper, No. 165, of Session I, 1922)".—[Mr. Godfrey Locker-Lampson.]

Oral Answers to Questions — INDIA.

CANTONMENT MAGISTRATES (RETIREMENT).

Colonel Sir CHARLES YATE: 1.
asked the Under-Secretary of State for India whether his attention has been called to the terms of the new Bill which is to be introduced shortly by the Government of
India to municipalise the government of cantonments in India under the reform scheme; and whether under the changed conditions of service Indian Army officers in civil employment as cantonment magistrates will now be permitted to retire on proportionate pensions the same as other officers in similar positions?

The UNDER-SECRETARY of STATE for INDIA (Earl Winterton): There are not considered to be sufficient grounds for permitting cantonment magistrates to retire on proportionate pensions under present conditions, but if the Bill, which is at present before the Legislative Assembly, pass into law, their position may require further consideration.

Sir C. YATE: Will the Noble Lord give that consideration?

Earl WINTERTON: Obviously, if I say it is going to receive consideration, it will receive consideration.

RELIGIOUS DISTURBANCES, PUNJAB.

Sir C. YATE: asked the Under-Secretary of State for India whether, considering that the majority of the Sikh community in the Punjab has refused to accept the legal solution of the Sikh religious differences provided by the Sikh Shrines Act passed into law last year by the Punjab Council, and that the hostile attitude of a large section of malcontent Sikhs has now led to serious disorders, threatening the security of many parts of the province and requiring the frequent calling out of troops to maintain order, resulting in a situation which is menacing the safety of the Punjab and reacting on other provinces, the Secretary of State will now consider the question of transferring the disturbed Sikh areas either to the adjoining Sikh native states or else of restoring some of the old Sikh states in those areas in the hope that the Sikhs themselves under Sikh rulers will be able to deal more effectively with the situation that has arisen from Sikh differences over Sikh religious affairs?

Earl WINTERTON: The reply to the hon. and gallant Member's question is in the negative.

Sir C. YATE: Does the Secretary of State realise the danger of the situation in the Punjab, and the necessity for special measures to deal with it?

Earl WINTERTON: One may see certain dangers in the present situation without accepting the hon. and gallant Member's suggestion for dealing with it.

Sir C. YATE: Can the Noble Lord give me an alternative?

Earl WINTERTON: I should be pleased to do so in debate.

BRITISH SOLDIERS (INCOME TAX).

Lieut. - Colonel HOWARD - BURY: 3.
asked the Under-Secretary of State for India whether he is aware that Income Tax is charged on British soldiers serving in India at the rate of 5 pies on every rupee they earn, including marriage allowance, and that the more children he has the more Income Tax he has to pay; and will he make representations to the Government of India to fix the Income Tax payable by the British soldier in India on the same basis as is charged in this country and remove what is looked upon as a real grievance by the British soldiers there?

Earl WINTERTON: When the total income is below Rs. 2,000 per annum (say £133) no Income Tax is payable. From Rs. 2,000 to Rs. 5,000 the rate is 5 pies in the rupee. Marriage allowances in India are included in income for the purpose of assessment of tax. This is also the case at home; but the Indian Income Tax system differs fundamentally from that of the United Kingdom and contains no provision for personal or family reliefs. The introduction of the system now in force in this country would involve a revision of the principles on which Indian Income Tax is levied. My Noble Friend will, however, be glad to send a copy of this question and answer to the Government of India for their consideration.

JUDICIAL COMMISSIONER CENTRAL PROVINCES.

Mr. J. HOPE SIMPSON: 4.
asked the Under Secretary of State for India whether he is aware that a judicial officer of the Bombay Presidency has been appointed to the post of Judicial Commissioner of the Central Provinces; whether representations have been received from senior judicial officers of the Central Provinces on the subject of their supersession; and what are the
reasons which have led to the appointment of an officer from outside the provinces instead of the promotion of the local senior judicial officer?

Earl WINTERTON: I am aware that the post of Judicial Commissioner is now held in the Central Provinces by an Indian Civil Service officer lent by the Government of Bombay, but I cannot say whether any representations have been made by any officers whose qualifications for the post may have had to be considered. It must be presumed that the Indian authorities were satisfied that the appointment made was most in accord with the interests of the province.

Mr. SIMPSON: Can the Noble Lord give us a reason why the senior officers in the Central Provinces were passed over?

Earl WINTERTON: That is a question of administration, and it is rather inconvenient to raise it in answer to a question. The point is that the Government are quite entitled to go outside the province, if they so desire, in connection with this appointment.

Sir JOHN HEWETT: Is it not very unusual to do so?

Earl WINTERTON: There have been other instances. At any rate, as the law and the rule stand, it is open to the Government to do so.

LORD LAWRENCE'S STATUE.

Mr. HARRISON: 5.
asked the Under-Secretary of State for India if he will inform the House of the stage reached in the negotiations between the Lahore Municipality and the Government of the Punjab regarding Lord Lawrence's statue; and, if the matter has not been determined, will he impress upon the Government of India the indignation that will be aroused throughout the country should the statue be removed?

Earl WINTERTON: The matter is still under consideration by the Indian authorities, and I am not able to add to the reply given to the hon. Member for Luton on the 4th June, except to say that no action will be taken without reference to my Noble Friend.

Sir C. YATE: Has the Noble Lord's attention been called to the Black Hole Memorial in Calcutta, and the agitation that is now being raised?

Earl WINTERTON: I do not think that has anything to do with this question, which refers specifically to the Lawrence statue at Lahore.

Oral Answers to Questions — TANGANYIKA (AFRICAN PRISONERS).

Sir SYDNEY HENN: 6.
asked the Under-Secretary of State for the Colonies the number of African prisoners in Tabora gaol taken over from the Belgian Government when that part of Tanganyika Territory was transferred to British civilian administration; the number reprieved by the British authorities after reconsideration of their cases; the number who have served in full sentences inflicted by the Belgian courts; the number who have died while under sentence; and the number still serving sentences imposed by the Belgian courts?

The UNDER-SECRETARY of STATE for the COLONIES (Mr. Ormsby-Gore): I have no information in the matter, but an inquiry will be addressed to the Governor of the Tanganyika Territory with regard to it. The transfer of Tabora from Belgian to British occupation took place early in 1917, while military operations were still in progress, and before the civil administration was organised.

Oral Answers to Questions — BRITISH SOUTH AFRICA COMPANY.

Colonel WEDGWOOD: 7.
asked the Under-Secretary of State for the Colonies whether among the alienated lands of the British South Africa Company, the value of which is to be deducted from the compensation due to the company, is a grant of 50,000 acres of Southern Rhodesian land to the Northumberland mining syndicate made in the year 1892; whether this grant was made more than a year prior to Sir Starr Jameson's invasion of Matabeland; by what right this concession was granted in a territory which at that time was in no respect under the British Crown; and what consideration was received by the company for this concession?

Mr. ORMSBY-GORE: I am not in a position to add anything material to the information given in Appendix 5 to the proceedings of Lord Cave's Commission,
beyond observing that further investigation showed that the greater part of this land grant was subsequently abandoned. As to the third part of the question, I may observe that the company had acquired the Lippert Concession early in 1892, and I presume it was thought at the time that they were acting in accordance with the terms of that concession. In any case, it is clearly not possible now to question the grants made by the company prior to the conquest in 1893.

Colonel WEDGWOOD: Am I to understand that no consideration was received by the company for this concession?

Mr. ORMSBY-GORE: I forget about that.

Mr: LINFIELD: 15.
asked the Under-Secretary of State for the Colonies whether communications, both individual and collective, have been received from the white inhabitants of Northern Rhodesia protesting against the land claims of the British South Africa Company in that territory; and if he will say what steps are being taken by His Majesty's Government to give these settlers an opportunity of stating their position before reaching any settlement with the Chartered Company?

Mr. ORMSBY-GORE: I would refer the hon. Member, as regards the first part of his question, to Appendix I in the second Report of Lord Buxton's Committee (Cmd. 1471), and, as to the second part, to the answer which I have just given to the hon. and gallant Member for Newcastle-under-Lyme.

Mr. LINFIELD: I suppose that there is no question of the annexation of Northern Rhodesia to Southern Rhodesia?

Mr. ORMSBY-GORE: Not that I know.

Mr. LINFIELD: 16.
asked the Under-Secretary of State for the Colonies whether, seeing that Lord Cave's Commission fixed the amount conditionally due to the British South Africa Company and the means by which the net figure was to be reached, and that, when this Commission was proposed, Lord Milner received a written statement from the company in advance that they agreed to the request of His Majesty's Government for an assurance that the company would accept the recommendations as binding,
he will say whether the company's attention has been drawn to this material fact in the present dispute, and with what result?

Mr. ORMSBY-GORE: The correspondence with the British South Africa Company which led up to the appointment of Lord Cave's Commission, and the terms of reference to that Commission, are included in the Papers published in Cmd. 1129. It is the fact that the company, as well as His Majesty's Government, are bound by the award of the Commission, but the present discussions relate to the issues raised in the company's Petition of Right.

Colonel WEDGWOOD: 11.
asked the Under-Secretary of State for the Colonies whether, seeing that Lord Buxton's Commission, whilst unanimously recommending the reference of the Northern Rhodesia land case to the Judicial Committee of the Privy Council, drew attention to the fact that there were interests other than the Colonial Office and the company to consider, he will say what steps His Majesty's Government is taking to meet the interests of the white settlers, the native people of Rhodesia, and of the Treasury?

Mr. ORMSBY-GORE: I would refer my hon. and gallant Friend to the answer that I gave to the hon. Member for Bedford, Mid., on 13th June, in which I indicated that the interests of the natives of Northern Rhodesia were being carefully watched in the discussions with the British South Africa Company. The same remark applies to the other interests concerned.

Mr. CHARLES BUXTON: 23.
asked the Under-Secretary of State for the Colonies whether His Majesty's Government is proposing to include Northern Rhodesia in any grant of the letters patent promised for Southern Rhodesia; and whether the settlers in Southern Rhodesia have withdrawn their opposition to any arrangement which would involve Southern Rhodesia in any liability for the administration of Northern Rhodesia?

Mr. ORMSBY-GORE: The reply to the first part of the question is in the negative; as regards the second, the draft letters patent do not contemplate any such arrangement as that suggested by the hon. Member.

Oral Answers to Questions — IRISH FREE STATE.

ARMS AND AMMUNITION (RESTORATION).

Sir JOHN BUTCHER: 8.
asked the Under-Secretary of State for the Colonies whether he is aware that there has been great delay in restoring to their owners the arms and ammunition taken before the truce by the British Government from loyalists resident in Southern Ireland; whether the arms and ammunition so taken will be at once restored to those owners who are now living in Great Britain or Northern Ireland; and what steps should be taken by those owners who are still living in Southern Ireland to regain possession of their arms and ammunition so taken?

Mr. ORMSBY-GORE: There is now no delay in dealing with applications for the return of arms now stored in this country, and a considerable number of these have in fact been returned to their owners. As regards those stored in the Irish Free State, my Noble Friend the Secretary of State has asked the Government of the Irish Free State to undertake the task of returning arms so surrendered to owners resident in Great Britain or Northern Ireland, and I am informed that arrangements are being made to have this done as soon as possible. The return of arms to persons resident in the Free State area must necessarily depend on the issue of permits for their possession by the Free State Government.

Sir J. BUTCHER: To whom should application be made for the return of these arms?

Mr. ORMSBY-GORE: I think I gave the actual address in answer to a question a fortnight ago. I will look it up.

SPECIAL ADVISER (MR. LIONEL CURTIS).

Sir WILLIAM DAVISON: 19.
asked the Under-Secretary of State for the Colonies why it is necessary for the Secretary of State to continue to employ a special adviser, who is not a member of the Civil Service, in connection with Southern Irish affairs; what are the special qualifications possessed by Mr. Lionel Curtis in this respect; what are the terms of the contract which has been made with him and on what date will it terminate; and if he will explain why there is no member of the Civil Service
who is competent to discharge these duties and thereby save the State the expense of a special appointment?

Mr. ORMSBY-GORE: My Noble Friend the present Secretary of State, like his predecessor, has found it necssary to strengthen the staff of the Colonial Office in order to assist him and the Department in all business relating to the Irish Free State. For such an appointment an officer was required who combined knowledge of the self-governing Dominions, as well as of the new conditions arising out of the Treaty settlement. These special qualifications are possessed by Mr. Curtis, who was formerly a member of the Colonial Service in South Africa; has visited all the self-governing Dominions and made a close study of their Constitutions; and acted as secretary of the British Delegation that negotiated the Treaty. Mr. Curtis is a temporary member of the home Civil Service and is paid at the rate of £150 a month. His appointment, which carries no pension rights, is terminable at three months' notice on either side. No permanent member of the Civil Service possessing comparable experience is available.

Sir W. DAVISON: Why is this appointment kept on in the case of the Colonial Office when all similar Wartime appointments have been done away with? What are the special matters which require the advice of a special official, especially having regard to the fact that the Free State now has its own separate Government?

Mr. ORMSBY-GORE: As I have explained, my Noble Friend, who had nothing to do with the settlement of the Treaty, requires the continuation of the services of somebody who had, and who knows all that was going on, and in view of the new constitutional relations between the Free State and the self-governing Dominions, and of the coming Imperial Conference, my Noble Friend was of opinion that it was advisable to retain one who is a recognised authority on Dominion Constitutions.

Sir W. DAVISON: When will this gentleman's contract be terminated? How much longer will the country have to spend £1,800 on this official?

Mr. ORMSBY-GORE: As I explained in my answer, if we get rid of Mr. Curtis it will be necessary to strengthen the Colonial Office by an additional staff, because we have taken over the whole of the Irish work in the Colonial Office which we have never had to do before. We are now carrying out the work of the Chief Secretary as well as other additional duties. We are already understaffed, and it will be necessary to get someone else in lieu of Mr. Curtis.

Sir H. BRITTAIN: Meantime, is not the Colonial Office extremely fortunate in getting Mr. Curtis?

Sir HENRY CRAIK: As we are now entering on a new period, would it not be better to get somebody who was not so closely connected with the Treaty relations for which this Government is not responsible?

Mr. ORMSBY-GORE: That is not my Noble Friend's opinion.

Colonel GRETTON: rose—

Mr. SPEAKER: The mattter cannot now be debated.

ROYAL IRISH CONSTABULARY TRIBUNAL.

Sir J. BUTCHER: 20.
asked the Under-Secretary of State for the Colonies whether, in view of the fact that Mr. Clayton, who was the Royal Irish Constabulary representative on the Royal Irish Constabulary Tribunal, did not sit on the tribunal for five months after December, 1922, and that many cases were heard and decided by the tribunal in the absence of Mr. Clayton, and with only two members of the tribunal present, he will give directions that such cases shall be reheard before the full tribunal in cases where the person concerned desires it?

The UNDER-SECRETARY of STATE for the HOME DEPARTMENT (Mr. G. Locker-Lampson): No, Sir. As I stated in the reply which I gave to the hon. and learned Baronet on 18th June last, I cannot admit that there is any foundation for the suggestion that the recommendations of the tribunal made during the temporary absence of one of its members are such as to require revision.

Sir J. BUTCHER: If a person make out a prima-facie case, showing that he has been enormously prejudiced by the
absence of the Royal Irish Constabulary representative, will my hon. Friend get the case re-heard?

Mr. LOCKER-LAMPSON: As my hon. and learned Friend knows, a deputation waited at the Home Office the other day, and they were invited to send in any specific case of grievance. If any specific case of grievance be sent in, it will certainly be considered.

SOLICITORS.

Mr. T. P. O'CONNOR: 24.
asked the Under-Secretary of State for the Colonies on what date His Majesty's Government will issue an. Order in Council extending the provisions of the Colonial Solicitors Act to the Irish Free State, admitting Irish solicitors to practise in England on the same terms as English solicitors are admitted to practise in the Free State?

Mr. ORMSBY-GORE: In accordance with practice, His Majesty's Government will await a communication from the Government of the Irish Free State before taking any action in this matter; and it is believed that such a communication will shortly be received. It will then be necessary to consult the Law Societies in this country. I am not, therefore, yet in a position to say on what date it will be possible to issue an Order in Council.

Colonel GRETTON: Is it a fact that English solicitors can practice in the Free State, and are there any practising there now?

Mr. ORMSBY-GORE: Perhaps my hon. and gallant Friend will put down a question.

Oral Answers to Questions — FRANCHISE QUALIFICATIONS, BRITISH DOMINIONS.

Sir C. YATE: 9.
asked the Under-Secretary of State for the Colonies what are the qualifications for the franchise in each of the British Dominions for British subjects entering those Dominions from Great Britain or any other parts of the Empire?

Mr. ORMSBY-GORE: In all the Dominions there is a residential qualification for the franchise, but when the prescribed term of residence has been fulfilled, a British subject entering a
Dominion becomes qualified for the franchise on the same conditions as British subjects permanently settled in the Dominion. I regret that it is not possible to deal fully with the matter in detail within the limits of a reply to a question, but I shall be happy to furnish my hon. Friend with further information if he so desires and will communicate with me.

Oral Answers to Questions — PALESTINE.

BUDGET.

Mr. BECKER: 12.
asked the Under-Secretary of State for the Colonies the amount of the deficiency in the Budget accounts in Palestine during the past year; are the Arabs in Palestine paying taxes; and by whom are the taxes in Palestine levied?

Mr. ORMSBY-GORE: The final accounts of the revenue and expenditure of the Palestine Government for the past financial year have not yet been received, and I am therefore unable to state what deficiency, if any, they will disclose. The answer to the second part of the question is in the affirmative. With regard to the last part, taxation is levied under ordinances made by the High Commissioner with the approval of the Secretary of State for the Colonies.

Mr. BECKER: Can the hon. Gentleman say when the accounts for Palestine for last year will be received; and, with regard to the last part of the question, is that strictly legal and according to the Mandate? Had it not to be confirmed by the Assembly?

Mr. ORMSBY- GORE: No, the Assembly has nothing to do with the Mandate. The Council is final. It is certainly strictly legal. We conquered this territory with our troops and arms, and we have been collecting taxes ever since. With regard to the first supplementary question, I understand that the accounts are expected very shortly.

Mr. BECKER: We conquered Palestine with our troops, but we are not collecting any taxes ourselves, and it is being administered by Jews and not by us.

Mr. ORMSBY-GORE: That is quite untrue.

Mr. BECKER: If it be untrue, I beg to withdraw it.

Mr. ORMSBY-GORE: It is British administration. Because the High Commissioner was a right hon. Member of this House, to describe it as a Jewish administration is false.

Mr. BECKER: I did not mean to insinuate that any one gentleman was responsible. I mean the Assembly, because the Arabs have now refused to have any part in the government of Palestine. I did not mean any individual.

WATER POWER CONCESSIONS.

Mr. BECKER: 13.
asked the Under-Secretary of State for the Colonies if any progress has been made this year towards harnessing the latent water power in Palestine under the Rutenberg Concessions; and has any electrical energy been produced?

Mr. ORMSBY-GORE: Yes, Sir. I am informed that considerable progress has been made under the Auja Concession, which, as the House is aware, is the only concession that has actually been granted. Power house, cables and transformers have been installed and net-work erected in Tel Aviv and Jaffa, where the current is now available. In anticipation of the supply, 225 applications for connections had been received in Tel Aviv and Jaffa up to 28th June, including many from Arabs. Supply of current began on 28th June.

Captain Viscount CURZON: Can the hon. Gentleman say whether the machinery was installed by British or by foreign firms?

Mr. ORMSBY-GORE: It was installed by the Rutenberg Company.

BRITISH POLICY.

Lieut.-Colonel HOWARD - BURY: 26.
asked the Under-Secretary of State for the Colonies whether the Government intend to safeguard the civil and religious rights of all the inhabitants of Palestine, irrespective of race and religion, and intend to govern the country in conformity with the wishes of the majority of the population, or whether they still intend to make Palestine into a Jewish national home?

Mr. ORMSBY-GORE: The Government certainly intend to safeguard the civil and religious rights of all the inhabitants of Palestine, and to govern the country as
Mandatory power in accordance with the terms of the Mandate. As defined in the White Paper submitted to Parliament last year, His Majesty's Government are charged with the duty of facilitating the development by Jews of a Jewish national home in that country, but the creation of a Jewish State or Government is no part of such a policy. As Trustee for the Holy Land, on behalf of the League of Nations, it is the object of the British Government and of the British Administration in Palestine to promote the harmony and development of all races and creeds in Palestine, and to prevent the domination of any one over any other.

Captain BERKELEY: Do the Government still adhere to the Balfour Declaration?

Mr. ORMSBY-GORE: Yes.

Oral Answers to Questions — KENYA CIVIL SERVICE.

Sir ROBERT HAMILTON: 14.
asked the Under-Secretary of State for the Colonies what compensation, if any, has been allowed in respect of compulsory retirement or abolition of office to those officers in the Kenya Civil Service who have been retrenched before reaching the ordinary retiring age?

Mr. ORMSBY-GORE: In cases where it has not been possible to find employment for retrenched officials in other Colonies, compensation allowances have been granted on the principles of the Superannuation Acts in this country, that is to say, of as many sixtieths of the officer's pensionable emoluments as he has had years of service, two years being counted as three in the case of European officers under the provisions of the Superannuation Act of 1876.

Oral Answers to Questions — RAILWAYS, CROWN COLONIES.

Mr. PENNY: 17.
asked the Under-Secretary of State for the Colonies whether the Secretary of State for the Colonies is setting up a committee to examine the possibilities of the provision of railways and other forms of transport in Africa by private enterprise; and, if so, who have been invited to become members of the committee?

Mr. ORMSBY-GORE: Yes, Sir. My Noble Friend is setting up such a committee forthwith, but I am not at present in a position to state the composition of the committee, but I hope to be able to do so shortly.

Mr. D. G. SOMERVILLE: 21.
asked the Under-Secretary of State for the Colonies whether schemes of railway construction which may be planned as a charge on the funds of the Crown Colonies concerned are invariably first submitted to Parliament for its approval; and whether, in view of the difference of opinion as to the methods of railway construction in the Crown Colonies, he will arrange that in future this step will always be taken before any definite action is commenced?

Mr. ORMSBY-GORE: No, Sir, but the schemes in question are submitted to the local legislatures which provide the funds to carry them out, and are the proper bodies to deal with them.

Mr. SOMERVILLE: In view of the enormous cost of these railways, would it not be well to have an inquiry into the question of building them by private enterprise?

Mr. ORMSBY-GORE: As I stated in answer to another question just now, my Noble Friend is setting up a committee forthwith, including, I think, some Members of this House, to go fully into this question.

Sir A. SHIRLEY BENN: 22.
asked the Under-Secretary of State for the Colonies whether the Report by Colonel Hammond regarding the future construction of railways in East Africa on the departmental system deals with the State management of the Uganda line; and if he can indicate the terms of Colonel Hammond's recommendations?

Mr. ORMSBY-GORE: I regret that in the time at my disposal I have not found in Colonel Hammond's exhaustive reports on railway working in East Africa any expression of his view as between departmental or other construction of new railways, nor do his reports touch on the question of State versus private working of the Uganda Railway. Colonel Hammond's reports have been placed in the Library of the House.

Major - General SIR ROBERT HUTCHISON: 47.
asked the Prime Minister whether, in view of the excessive cost and unsatisfactory results demonstrated during the last 30 years of carrying out railway and other construction in the British Protectorates and Crown Colonies departmentally, His Majesty's Government will consider the advisability of putting out all future construction work to public tender?

Mr. ORMSBY-GORE: I have been asked to reply. I do not know on what facts the hon. and gallant Member bases the statement in the first part of his question, but I am unable to accept it. As regards the last part of it, future railways and other public works will be constructed either departmentally or by contract, as would appear to be the most economical or satisfactory course in any particular case. In the event of the decision being in favour of construction by contract, the question of putting out the work to public tender would be considered in each case on its merits.

Oral Answers to Questions — IMPERIAL CONFERENCE.

Sir H. BRITTAIN: 28.
asked the Under-Secretary of State for the Colonies whether he is able to give the names of the delegates who will attend the Imperial Conference this autumn?

Mr. ORMSBY-GORE: His Majesty's Government have not yet received full information as to the names of the representatives of the Dominions and India who will attend the Imperial Conference. It has, however, already been announced that most, if not all, of the Prime Ministers hope to be present.

Oral Answers to Questions — SUDAN.

PUBLIC WORKS

Sir H. BRITTAIN: 30.
asked the Under-Secretary of State for Foreign Affairs whether, in view of the unsatisfactory results of carrying out public works in the Sudan by administration, it is the intention of the Ministry to carry out any further large works by administration either in the Sudan or in any other of His Majesty's protectorates?

The UNDER-SECRETARY of STATE for FOREIGN AFFAIRS (Mr. Ronald McNeill): I would refer the hon. Member to the reply which I gave him on 7th June.

POLITICAL SERVICE.

Mr. JOHN DAVIES: 42.
asked the Under-Secretary of State for Foreign Affairs if any selection of probationers in the Sudan political service has recently taken place; if not, if he will explain why some candidates have already been informed, prior to the first meeting of the Selection Board, that their names had not been included amongst those selected for such appointments; what was the total number of candidates for the recently advertised posts; the number of those to whom such notifications of their applications were sent and the reasons for such rejections; and whether the rejection of candidates before their applications had been considered by the Selection Board is authorised by any and, if so, what Regulation of the Governor-General or of His Majesty's Government.

Mr. McNEILL: I am unable to say whether the Board which sat on the 27th, 28th, and 29th June has yet made definite recommendations. Before the Board assembles a preliminary selection is made of candidates to go before the Board based upon the detailed information provided in the standard application forms. This procedure, which was laid down by Lord Cromer, has always been followed since recruiting for the Sudan service was first started. I do not possess the information requested in the third and fourth parts of the question, as the Foreign Office has never interfered with the Sudan Government's freedom of action in selecting the personnel for its service.

Oral Answers to Questions — CHINA (PROTECTION OF FOREIGNERS).

Mr. GERSHOM STEWART: 31.
asked the Under-Secretary of State for Foreign Affairs whether the Chinese Government has shown any willingness to accept the principle of a specially organised force of gendarmerie under foreign officers to protect foreigners on the main railway lines; whether he is aware that the present condition of chaos in China is causing profound uneasiness among all
foreigners; and whether His Majesty's Government would consider making proposals to America and Japan to take joint action under the League of Nations for the mutual support and protection of all foreigners, the expenses of such action to be deducted from allowances promised from the Boxer indemnity?

Mr. McNEILL: The demands for a settlement of the recent brigand outrage on the Tientsin-Pukow railway, which it has been suggested should include the establishment of railway police under foreign officers, are still being considered by the Powers concerned, and have not yet been presented to the Chinese Government. His Majesty's Government are well aware of the present disturbed conditions obtaining in China, and are doing all that is possible in the circumstances to secure better protection for British residents and trade in that country. The reply to the last part of the question is in the negative.

Mr. STEWART: Will the hon. Gentleman use his influence to see that our garrisons in China are fully maintained, especially in Northern China, and, if possible, strengthened; and will he also use his influence to see that our flag is shown at the smaller outposts in China to reassure those of our people there, who may think they are being neglected or forgotten?

Mr. McNEILL: Those are suggested details in connection with policy, which I think are covered by my reply.

Captain BERKELEY: In view of the fact that China is a member of the Council of the League of Nations, will the hon. Gentleman see if that machinery cannot be made use of in the manner suggested in the original question?

Oral Answers to Questions — SAAR VALLEY ADMINISTRATION.

Mr. C. BUXTON: 33.
asked the Under-Secretary of State for Foreign Affairs whether His Majesty's Government will instruct their representative on the Council of the League of Nations at its forthcoming meeting to propose that the question of the right of the Council to inquire into the administration of the Saar basin shall be referred, if necessary, to the International Court of Justice?

Mr. McNEILL: I do not consider that in existing circumstances any useful purpose would be served by my giving such an undertaking; nor am I aware that the right of the Council to institute such inquiry as they may think fit has been challenged.

Mr. BUXTON: If such rights were contested, would our representative be empowered to make the suggestion indicated?

Mr. McNEILL: I have said in reply to the original question that I am not prepared to say so; it is a hypothetical question, and can only be considered when it arises.

Mr. BUXTON: 34.
asked the Under-Secretary of State for Foreign Affairs whether His Majesty's Government will instruct their representative on the Council of the League of Nations at its forthcoming meeting to propose that Germany be invited to be represented on the proposed inquiry into the administration of the Saar basin?

Mr. McNEILL: No, Sir.

Oral Answers to Questions — PASSPORTS.

Mr. GILBERT: 35.
asked the Under-Secretary of State for Foreign Affairs the number of British passports issued by his Department to British and naturalised subjects for the years 1920, 1921, and 1922?

Mr. McNEILL: The total number of passports issued at the Passport Offices in London and Liverpool during the years referred to was


1920
329,800


1921
255,539


1922
243,542


These figures do not include renewals.

Mr. GILBERT: 36.
asked the Under-Secretary of State for Foreign Affairs whether all British passports are issued only at the Foreign Office in London; whether there are any provincial departments, either in the North of England, Scotland, or Northern Ireland, where passports are issued; if so, will he state where they are; whether any staff of his Department are employed on this work and, if so, how many; and what is the approximate annual cost?

Mr. McNEILL: Passports for British subjects resident in Great Britain and Ireland are issued only at the Passport Office in London and the Branch Passport Office at Liverpool. The staff employed at the Liverpool office at the present moment is 45, but this total is varied in proportion to the volume of work. The estimated cost of the Liverpool office for the present year is £5,835.

Mr. GILBERT: 37.
asked the Under-Secretary of State for Foreign Affairs whether his Department maintain any officials or staff at any of the seaports in this country in order to check or verify the passports issued to British subjects leaving or entering this country; if so, can he state how many persons are so employed and what is the approximate annual cost of such staff; and, if not, can he state if his Department issue any instructions to Customs or police on the matter?

Mr. McNEILL: The answer to the first and third parts of this question is in the negative. The point raised in the second part does not, therefore, arise.

Oral Answers to Questions — PEACE TREATIES.

REPARATIONS (ITALY).

Mr. SMEDLEY CROOKE: 38.
asked the Under-Secretary of State for Foreign Affairs the amount and approximate value in gold marks of the nitrate and other raw materials imported from Germany since the signing of the Treaty of Versailles by the Italian Government on account of reparations?

The FINANCIAL SECRETARY to the TREASURY (Sir William Joynson-Hicks): The total value of all deliveries in kind to Italy down to 31st December last will be found on page 25 of the "Statement of Germany's Obligations," published by the Stationery Office, on behalf of the Reparation Commission. I cannot say how much of this total was raw materials.

GERMAN NOTE.

Brigadier-General SPEARS: 56.
asked the Prime Minister if he can make a statement to the House as to the possibility of despatching a speedy answer to
the German Note, in view of the fact that the protracted delay is a very serious matter owing to the increasingly dangerous economic situation of Germany?

The PRIME MINISTER (Mr. Stanley Baldwin): I cannot make any statement at the moment. His Majesty's Government are fully alive to the gravity of the situation, and are doing what they can to expedite matters.

Brigadier-General SPEARS: May I ask the right hon. Gentleman whether, if there is to be any further delay, he will consider the question of approaching these Powers which are now in occupation in the Ruhr, with a view to getting them not to take any further measures tending to cause the collapse of Germany?

Oral Answers to Questions — TRADE AGREEMENTS.

Mr. CROOKE: 39.
asked the Under-Secretary of State for Foreign Affairs if he can state the position with regard to the trade agreement between this country and Finland; and whether His Majesty's Government has under consideration the conclusion of trade agreements with Lithuania and Esthonia on the lines of the agreement with Latvia, signed on the 22nd June?

Mr. McNEILL: Negotiations for the conclusion of commercial treaties on the lines of the agreement with Latvia, signed on 22nd June, are still proceeding with Finland and also with Esthonia. Our commercial relations with these countries are at present regulated by agreements embodied in exchanges of Notes, dated 20th July, 1920, and 6th May, 1922, respectively. Negotiations for a definitive treaty with Lithuania have not yet been opened.

Oral Answers to Questions — RUHR OCCUPATION (FRENCH ARMY, COST).

Brigadier-General SPEARS: 41.
asked the Under-Secretary of State for Foreign Affairs if any proposals have been received from the French Government that the cost of maintaining the French army in the Ruhr should be placed to the account of the armies of occupation; and if he will define the attitude of His Majesty's Government to such a proposal?

Mr. McNEILL: The answer to the first part of the question is in the negative; the second part of the question does not, therefore, arise.

Brigadier-General SPEARS: Does the hon. Gentleman not consider that he ought to make the views of His Majesty's Government known, not only because the statement referred to in the question was made by the French Prime Minister in the Senate, but also because—[HON. MEMBERS: "Order!"]

Captain WEDGWOOD BENN: Has the hon. Gentleman's attention been called to the fact that M. Poincaré stated that not only would these costs be charged to the reparation account, but would be given priority?

Mr. McNEILL: I do not think that is quite a correct rendering of what M. Poincaré said. The matter is not at all clear, but the answer which I have given to the question on the Paper is strictly accurate.

Colonel WEDGWOOD: Could not the Government make an effort to discover what are the intentions of the French Government in this matter and whether they do claim priority?

Mr. McNEILL: Of course the Government can take steps to ascertain that, if they think it desirable to do so.

Mr. PRINGLE: Is it not the case that the French Government do not trouble to reply to us now?

Brigadier-General SPEARS: Is it the fact that the French Prime Minister stated that this action was taken on behalf of the Allies?

Oral Answers to Questions — UNITED STATES LIQUOR REGULATIONS.

Sir W. DAVISON: 43.
asked the Under-Secretary of State for Foreign Affairs whether he is aware that the Supreme Court of the United States, in their recent judgment, expressly laid down that the local sovereign, in this case the American Government, may always, out of consideration for public policy, forgo to exercise its jurisdiction in any matter, or exert such jurisdiction in a limited way without in any respect prejudicing or forgoing its sovereign rights; whether
the attention of the United States Government has been drawn to this dictum of their Supreme Court, which entitles the American executive to forgo their strict legal rights should they desire to do so; and whether, having regard to the well-established principles of international law that a ship continues to be identified with its country of origin in foreign ports so far as its domestic affairs are concerned, and, and, if so, what, representations have been made to the American Government with regard to the seizure of spirituous liquors in British ships where such liquors have been placed in rooms specially sealed by the British Customs authorities and with adequate guarantees that such seals would not be broken while in American territorial waters, thereby precluding any possibility of the infraction of the American prohibition law while the ship was in the territorial waters of the United States?

Mr. McNEILL: My Noble Friend the Secretary of State gave in another place on 28th June a full explanation of the diplomatic action which His Majesty's Government have taken in this connection and the grounds on which their representations have been based. If, after reading that statement, there are any points on which my hon. Friend requires further information, I shall be happy to do my best to furnish it.

Sir W. DAVISON: Having regard to the statement made in another place that the United States Government have full power in the matter, are we to understand their refusal to exercise that power is simply to bring pressure to bear on this country, in order to get us to extend the three-mile limit?

Viscount CURZON: Are we to understand that His Majesty's Government have given the United States Government an absolutely free hand, to do what they like in this matter?

Mr. McNEILL: The second supplementary question suggests quite a false interpretation. In answer to the hon. Member for South Kensington (Sir W. Davison), I assure him there are particular factors in this question requiring consideration. For example, in his question, the hon. Member assumes that the American Government has sovereign power, but that would not be admitted
absolutely as within the meaning of the decision of the Supreme Court, if he means by the American Government, the Executive, or the President.

Sir W. DAVISON: Has not the President full sovereign power to act on behalf of the Executive in a matter of the kind, and, having regard to the decision of the Supreme Court, that the sovereign power has a right to act, surely the United States Government has the power to fulfil the request of Great Britain and allow liquor to remain under seal, when it will not be consumed in their waters?

Mr. A. M. SAMUEL: Is it not the fact that a false statement of law has placed the United States Government—which means very well—in such a position that it has become the laughing stock of the world?

Mr. PRINGLE: I wish to know whether the fact that a full statement on a question of policy has been made in another place absolves the representative of the Government from making a full statement in reply to questions in this House?

Lieut. - Colonel HOWARD - BURY: 49.
asked the Prime Minister whether he has any information with regard to the intentions of the United States Government that in future they intend to seize foreign ships coming into their harbours with liquor on board, under seal, and to arrest their captains; and whether he will consult with other European countries with a view to taking up retaliatory legislation against American shipping coming into European harbours, in order to induce the United States Government to abide by the international comity, which has always existed between maritime nations?

Viscount CURZON: 50.
asked the Prime Minister whether he is aware that new regulations are now to be made which will entail the seizure of the vessel and arrest of the captain in the case of ships carrying liquor within American waters, whether under the Seal of the British Government and whether flying the British flag or not; whether the Government are prepared to recognise the seizure of ships and arrest of their captains under such conditions; and whether His Majesty's Government will take steps to get in touch with the American Government on this question?

The PRIME MINISTER: I have no official information with regard to the alleged intentions of the United States Government to which these questions refer My Noble Friend the Secretary of State for Foreign Affairs recently gave, in another place, a full explanation of the present position, and I hope that the Interdepartmental Committee, which, as he stated, is now considering the question, will before long make definite recommendations which will enable his Majesty's Government to determine their attitude.

Lieut.-Colonel HOWARD-BURY: Can my right hon. Friend say whether the enforcement of this law by the United States Government is due to a desire to protect her mercantile marine and force foreign ships on to an equality—

Mr. SPEAKER: We must not have an interpretation of the motives of foreign Powers.

Mr. SHINWELL: Is it not about time for His Majesty's Government to declare that the interests of British trade and British shipping are of greater importance than are the alcoholic tastes of passengers on these ships?

Oral Answers to Questions — RIO INTERNATIONAL EXHIBITION (BRITISH PRIZE AWARDS).

Sir BURTON CHADWICK: 44.
asked the Parliamentary Secretary to the Overseas Trade Department whether he is aware that the judging committee of the Rio International Exhibition has awarded 771 prizes to French exhibitors, 300 to Italian exhibitors, 252 to Belgian exhibitors, 246 to United States exhibitors, and 114 to British exhibitors; whether he can say if Great Britain has ever before stood, relatively with other nations, so low in prize awards at great international exhibitions; whether he can say why Great Britain has done so poorly at the Rio Exhibition; and whether he can see his way to issue some official comment, both for the benefit of traders in this country and British traders in South America?

Lieut.-Colonel BUCKLEY (Secretary, Overseas Trade Department): The number of awards to British exhibitors at the Rio International Exhibition is 143, otherwise the figures are correct. The numbers reflect numerical strength, not importance of exhibits. Excluding 24 non-
competitive awards to suppliers of building and decorative material, no less than 72 per cent. of British exhibitors obtained highest awards possible. In the absence of precise information as to the character of the awards to other nations, no fair comparison is possible, but although the number of British exhibitors was comparatively small, the high standard of their exhibits was clearly maintained and I do not, intend to issue any official Comment until the Report on the British section is published.

Oral Answers to Questions — FIGHTING SERVICES (COST).

Mr. LAMBERT: 46.
asked the Prime Minister whether, as the gross expenditure for the current year on the fighting Forces is nearly £60,000,000 above pre-War, exclusive of the recently announced increase of the Air Force, he will appoint a small Commission to ascertain whether there is waste in the Services; and whether the country is getting defensive value for the sums expended?

The PRIME MINISTER: His Majesty's Government have at present under consideration the Reports which they have received on Army and Navy establishments. A Committee, under Sir Alan Anderson, is inquiring into the pay of Crown servants including the members of the fighting Services. The Service Departments have been asked to furnish provisional estimates for 1924–25. When these are received I will consider the method to be adopted for examining them. As at present advised I do not consider the appointment of a further Commission desirable.

Mr. LAMBERT: Is the right hon. Gentleman aware that a great deal of waste is now going on as a result of overlapping between the Services; and would it not be desirable to have a Committee or Commission to inquire whether the Services could not be co-ordinated, so that the country might get defensive value for the money spent?

The PRIME MINISTER: That is one of the subjects which is now engaging the attention of the Committee of Imperial Defence. I am not so fond of Commissions as other hon. Members seem to be.

Oral Answers to Questions — RUSSIA (DIPLOMATIC RECOGNITION).

Mr. D. G. SOMERVILLE: 55.
asked the Prime Minister whether, within the last year, the Soviet Government has officially made any request to His Majesty's Government for diplomatic recognition; and what answer, in that case, has been returned?

Mr. McNEILL: The answer to the first part of the question is in the negative. The second part, therefore, does not arise.

Oral Answers to Questions — AERIAL ARMAMENTS (LIMITATION).

Mr. MOREL: 51.
asked the Prime Minister whether, seeing that the deliberations of the League of Nations on the subject of the limitation of armaments, including air armament, have lasted for a considerable period and that during that period certain Powers represented on the Council and with knowledge of the League have largely increased their air armament and are continuing to do so, His Majesty's Government will take the initiative, in conjunction with the Government of the United States, to convoke a conference of all the Powers, both those which are represented on the League and those which are not, in order to restrict the construction of aerial war craft with a view to protecting the civilian population of all countries from the consequences of aerial farfare?

The PRIME MINISTER: His Majesty's Government are not prepared to adopt the course suggested by the hon. Member.

Mr. MOREL: In view of the very grave statement made in this House a few days ago, and the immediate response of the French, cannot the right hon. Gentleman give the House some further information as to why the Government cannot take this course?

The PRIME MINISTER: In my view, it would be premature to hope for a successful issue to such a conference until a number of outstanding matters which remain unsettled in Europe to-day are settled.

Captain BERKELEY: In view of the impossibility of dealing adequately with this question by question and answer across the Floor of the House, will the
Prime Minister be able to give a date on which a discussion on this most important subject could take place?

The PRIME MINISTER: It is always open to discuss this question on the Consolidated Fund Bill, but I cannot think at the moment that a discussion would help us at all.

Mr. LEACH: 58.
asked the Prime Minister if he has any confirmation of a statement that perturbation has been caused in the French Chamber at this country's proposals to increase its air forces, and that strong denials of any hostile purposes against Great Britain were made; and if he will at once propose to France a conference with the object of a mutual avoidance of wasteful expenditure, and the further object of securing a world understanding on the subject?

The PRIME MINISTER: I have seen no report of any discussion in the French Chamber, though I have, of course, seen the comments of the French Press. They do not, however, appear to me to bear out the words used by the hon. Member. As regards the second part of the question, I would refer the hon. Member to the reply which I have given this afternoon to the hon. Member for Dundee (Mr. Morel).

Commander BELLAIRS: Can the right hon. Gentleman say when it is proposed that the Washington Conference Treaty shall be ratified by the French Chamber, and whether we have any information on the question whatever?

Oral Answers to Questions — RESTORATION OF ORDER IN IRELAND ACT.

Captain BENN: 52.
asked the Prime Minister whether he can now make a statement as to the Inquiry into the Regulations made under the Restoration of Order in Ireland Act?

The PRIME MINISTER: I am not yet in a position to make a statement, but I will do so as soon as the Committee is constituted.

Captain BENN: Does the right hon. Gentleman realise that the Indemnity Bill was passed on the understanding that a revision of these powers would be undertaken by the Government?

The PRIME MINISTER: Yes, and I am exceedingly sorry for the delay, which is because of the illness of the Lord Chancellor. I quite hope that in a few days it will be possible to proceed with the matter.

Oral Answers to Questions — ARAB INDEPENDENCE.

Captain BENN: 53.
asked the Prime Minister what is the precise nature of the undertaking given by the Government to recognise and support the independence of the Arabs in Iraq, Transjordania, and the Arab States of the Arabian Peninsula?

The PRIME MINISTER: I understand the question to refer to the Treaty under negotiation with the Hedjaz Government. As was stated on the 25th June by my hon. Friend the Under-Secretary for Foreign Affairs, negotiations on this subject are still in progress, and it is not possible to say what precise form the Treaty, if concluded, may ultimately take.

Oral Answers to Questions — RHINELAND.

Mr. MOREL: 54.
asked the Prime Minister whether he has now obtained any information as to the authenticity of the document published last Sunday week purporting to be a report of the French Commissioner on the Rhineland High Commission; and whether the attitude of His Majesty's Government remains one of opposition to the policy of separating the Rhineland from the German Reich?

The PRIME MINISTER: I have nothing to add to the reply on this subject which I gave to the hon. Member for Aberavon (Mr. Ramsay MacDonald) on 25th June.

Mr. MOREL: Is the Prime Minister aware that the author of this Report is the Marquis de Lillers, delegate at Wiesbaden since 1921 of the Inter-Allied Rhineland High Commission, upon which Commission this country is represented?

The PRIME MINISTER: I cannot pursue all the statements that are made in the Press on these subjects. I have no official knowledge of that at all, and I do not think any further discussion of that matter at this moment would be of the slightest use.

Oral Answers to Questions — LONDON TRAFFIC.

Sir H. BRITTAIN: 57.
asked the Prime Minister whether he can give the approximate date when he will be able to announce any decision with regard to the subject of legislation to deal with London traffic?

The PARLIAMENTARY SECRETARY to the MINISTRY of TRANSPORT (Colonel Ashley): I have been asked to answer this question. I am not at present in a position to add materially to the answers which I gave to my hon. Friend on 25th June and to the Noble Lord the Member for South Battersea (Viscount Curzon) on the day following. The whole question of the better regulation of London traffic is receiving the closest consideration. I can promise the House to make an announcement on the subject as soon as I am in a position to do so, and in any case before the Recess.

Sir H. BRITTAIN: Bearing in mind the enormous losses of the citizens of London every week, cannot the hon. and gallant. Gentleman promise to set up an expert Committee to deal with this subject at the earliest possible moment?

Colonel ASHLEY: No. I do not think that is necessary.

Sir H. BRITTAIN: What does the hon. and gallant Gentleman think is necessary? Nothing has been done at all.

Oral Answers to Questions — BRITISH EMPIRE EXHIBITION.

Sir R. HAMILTON: 60.
asked the Parliamentary Secretary to the Overseas Trade Department the terms of the agreement on which Mr. Wintour was originally employed by the executive committee of the British Empire Exhibition; and if there was any Clause providing for dismissal in the case of inefficiency?

Mr. HUGH BUTLER: 59.
asked the Parliamentary Secretary to the Overseas Trade Department if he will give the names of the committee who made agreement with Mr. A. F. Wintour on behalf of the British Empire Exhibition?

Sir JAMES REMNANT: 61 and 63.
asked the Parliamentary Secretary to the Overseas Trade Department (1) if he will lay upon the Table a copy of the original
agreement made with Mr. Wintour on his appointment to the British Empire Exhibition;
(2) if the amount of £14,000 paid to Mr. Wintour was paid as compensation for part loss of salary till the end of the British Empire Exhibition next year; if not, what was it paid for; will he say if the amount of the compensation was submitted to the members of the executive council and the general council for their approval before being settled; and, if not, will he state the reason?

Dr. CHAPPLE: 62.
asked the Parliamentary Secretary to the Overseas Trade Department whether the £14,000 alleged to be payable to Mr. Wintour has actually been paid: can he give the names of those who personally negotiated the original contract of service with Mr. Wintour and the names of those who negotiated the new contract; whether they are still taking any part in controlling the administration of the British Empire Exhibition; and whether the Government intends to take any more intimate control of the disposal of the funds for which it is contingently liable?

Lieut.-Colonel BUCKLEY: A copy of the original agreement between the British Empire Exhibition and Mr. Wintour will be laid on the Table of the House. A sub-committee, consisting of Lord Morris, then chairman of the executive council of the British Empire Exhibition, Colonel Cole and Mr. Davis, was appointed to conduct the negotiations with Mr. Wintour for this agreement, and the draft was submitted to and approved at a meeting of the executive council on the 24th June, 1920. The agreement does not contain a clause providing for dismissal in case of inefficiency. I have already explained, in reply to a question by my hon. Friend the Member for the North Division of Leeds (Mr. H. Butler), the reasons for the cancellation of the original agreement, and I should like to make it clear that its cancellation does not reflect in any way on Mr. Wintour's efficiency.
The new arrangement with Mr. Wintour, has been concluded by the board to which the powers of the executive council have recently been delegated. The board consists of Sir James Stevenson, chairman; Sir Travers Clarke, deputy-chairman; Sir James Allen, representing the High
Commissioners of the Dominions; Sir Henry McMahon, chairman of the management committee; and Sir Charles McLeod, chairman of the finance committee. As I have already stated, the proposed arrangement was submitted to my right hon. Friend the Secretary of State for the Colonies as chairman of the executive council of the Exhibition, and was approved by him. The amount paid to Mr. Wintour was paid as compensation for loss of emoluments, but in assessing the amount it was necessary to take into account the fact that he had been engaged, not merely up to the close of the Exhibition itself, but also for the further period required for the liquidation of the undertaking. The amount agreed upon has been paid over to Mr. Wintour. The gentlemen concerned in the negotiation of the original agreement with Mr. Wintour and the members of the executive council who approved of it, are still members of the council, with the exception of one gentleman who has since died; and the board who concluded the recent arrangement with Mr. Wintour are still controlling, on behalf of the executive council, the business of the Exhibition.
The liability of His Majesty's Government is restricted to their guarantee of £100,000, whereas the total sum guaranteed amounts now to £1,200,000. The Exhibition has been organised from the first under private management, and it was on that basis that the guarantees were obtained. I do not think that it would be desirable for the Government to endeavour to interfere with the responsibility in financial matters of Sir James Stevenson and his colleagues, who are now in charge of the administration.

Sir J. REMNANT: Arising out of that part of the answer which deals with my questions, has the Minister seen the minutes submitted to the executive council, where no mention whatever is made of the amount of the compensation; among the emoluments for which Mr. Wintour has been compensated, is there included that amount, and, if so, what is it, for the motor-cars provided for him for running round the Exhibition, and the various other luxuries?

Mr. HANNON: In point of fact, has the award to Mr. Wintour been submitted at all to the executive council?

Lieut.-Colonel BUCKLEY: I have not seen the minutes. In regard to the amount paid to Mr. Wintour, when my hon. Friend sees the Paper that is to be laid on the Table, he will see the terms of the engagement, and he can then assess the amount of compensation for himself.

Mr. HANNON: Has the executive council sanctioned the award?

Lieut.-Colonel BUCKLEY: I know nothing about that.

Sir J. REMNANT: Is it not a fact that Mr. Wintour was appointed to this office six months in advance of the executive committee being appointed by the Government?

Lieut.-Colonel BUCKLEY: No, Sir.

Mr. HANNON: Was it not, in point of fact on the recommendation of the Board of Trade that Mr. Wintour was appointed general manager of the Exhibition?

Sir H. CRAIK: Is not this huge amount of compensation for a man foisted on us from the outside fixed on a scale totally different from that of the Civil Service?

Oral Answers to Questions — AGRICULTURE.

BEEF (PRICES).

Brigadier - General CLIFTON BROWN: 64.
asked the Minister of Agriculture the retail price per lb. of home-killed beef on 1st April, 1923, and on 1st July, 1923, of chilled beef on 1st April, 1923, and on 1st July, 1923, and of frozen beef on 1st April, 1923, and on 1st July, 1923; and whether he anticipates any future reduction in the price of meat owing to the introduction of Canadian stores?

Major BARNSTON (for Sir Robert Sanders): I have been asked to reply, and as the answer contains a number of figures, I propose, with my hon. and gallant Friend's permission, to circulate it in the OFFICIAL REPORT.

Brigadier-General BROWN: In view of the promise of the Meat Trust that we should get our meat sixpence per pound cheaper if the embargo were removed, will the Ministry take some steps to see that the promise is carried out?
Following are the figures:
The official statistics of retail prices compiled by the Ministry of Labour for the purpose of calculating the index number of the cost of living of working-class families show that the average retail prices of beef per lb. on the 31st March and 1st June, 1923, were as follow:



31st March.
1st June.


Beef, British.
s.
d.
s.
d.


Ribs
1
5¾
1
5¾


Thin Flank

10½

10½


Chilled or Frozen.






Ribs

10¼

10¼


Thin Flank

5¾

5¾


Figures for the 30th June are not yet available.
With regard to the last part of the question, it is not possible to forecast what may be the effect on prices of the admission of store cattle from Canada.

CO-OPERATIVE BACON FACTORIES.

Mr. NOEL BUXTON: 66.
asked the Minister of Agriculture if he can yet make a statement as to the proposed assistance to co-operative bacon factories and grading depots?

Major BARNSTON: I have been asked to reply. It is understood that Lord Linlithgow's Committee on the Distribution and Prices of Agricultural Produce proposes to deal with the subject of co-operative bacon factories in the Report on Meat which the Committee is now considering, and my right hon. Friend thinks it will be well to await the receipt of that Report before making any statement on the subject.

Mr. BUXTON: Is it anticipated that bacon factories will get any help under the Agricultural Credits Scheme?

Major BARNSTON: I am afraid I cannot answer that question, but I will communicate the point to my right hon. Friend.

FARMWORKERS (NORFOLK).

Mr. N. BUXTON: 67.
asked the Minister of Agriculture how many farmworkers in Norfolk who were in employment prior to the recent strike are now out of work; and whether he is able to take steps towards securing their reinstatement?

Mr. HAYES: 68.
asked the Minister of Agriculture whether he is aware that upwards of 1,000 farmworkers have not been reinstated since the settlement of the Norfolk farm dispute; and what steps, if any, he has taken to induce the farmers to honour the settlement agreement?

Major BARNSTON: I have been asked to reply. My right hon. Friend has received from the National Union of Agricultural Workers a list of over 1,000 men who ceased work during the recent strike in Norfolk and who are alleged not to have been reinstated. An officer of the Ministry is inquiring into a number of these cases, particularly those where it is alleged that other men have been engaged in place of men who came out on strike, but the inquiries are not yet complete, though I am glad to say that in a number of instances men have been reinstated as a result of the efforts of the Ministry and the influence of the county branch of the National Farmers' Union. In some cases, however, the employers concerned are not members of the union and do not consider themselves bound by the terms on which the strike was settled, and in other cases modifications were made in the farming programme during the currency of the strike which have rendered it unnecessary to employ the same amount of labour as before. The inquiry by the Ministry is still proceeding, and no effort is being spared to secure an amelioration of the position.

Mr. BUXTON: Does the Minister hold that practically all the men will be reinstated?

Mr. HAYES: Cannot the Minister indicate to the farmers that are not following the terms of the settlement that unless they do so they will not receive relief under the Agricultural Credits Bill when it becomes law?

Major BARNSTON: I do not know whether that will be possible or not. Inquiry is being made by the Ministry, and no effort is being spared to secure an amelioration of the position.

ALLOTMENTS.

Mr. D. G. SOMERVILLE: 69.
asked the Minister of Agriculture the approximate number of allotments now in existence
as compared with June, 1922; and whether, in view of the value of this cultivation, both from the point of view of health and providing cheap food, he is still stimulating the extension of the movement near industrial centres?

Major BARNSTON: I have been asked to reply. The last date up to which returns were obtained as to the number of allotments in England and Wales was the 31st December, 1920, when the number was estimated to be 1,330,000. It is proposed to call for further returns at the end of the present year, but meanwhile it is estimated that the number at present is approximately 1,000,000. In reply to the last part of the question, the Ministry has done and is doing everything possible in the direction of encouraging urban authorities to use their powers of providing allotments for their residents, and my right hon. Friend has every reason to suppose that these authorities are alive to the national and social importance of the allotment movement.

Oral Answers to Questions — ANGLING LICENCES.

Mr. N. BUXTON: 65.
asked the Minister of Agriculture the names of the freshwater fishery boards which are obtaining revenue from the issue of licences for angling for coarse fish, and the total revenue derived from angling licences of all kinds?

Major BARNSTON: I have been asked to reply. The following Boards of Conservators obtain revenue from the issue of licences for angling for coarse fish either separately or in conjunction with trout:

Derwent Board of Conservators.
Kent Bela, Winston Leven and Duddon Board of Conservators.
Lune Board of Conservators.
Wye Board of Conservators.
Norfolk Fishery Board.

The total revenue derived from angling licences of all kinds by all Boards of Conservators in England and Wales during 1922 was £18,020 10s. 9d.

Oral Answers to Questions — HOUSE OF COMMONS (EMBANKMENT ENTRANCE).

Mr. PENNY: 70.
asked the First Commissioner of Works whether and, if so,
when it is proposed to reopen the Victoria Embankment entrance to the House of Commons?

The FIRST COMMISSIONER of WORKS (Sir John Baird): The entrance in question is under the jurisdiction of the Lord Great Chamberlain, who, I understand, does not intend to reopen it at present.

Mr. LANSBURY: Can representations be made to this potentate that the reopening would be very likely to save the lives of some hon. Members, who are obliged to cross that very busy crossing to get to the trains, and that it would be a very great convenience to hon. Members if we could go through the subway?

Sir J. BAIRD: I quite agree that it would be a great advantage if it could be done. The London County Council have rights—

Mr. LANSBURY: So have we.

Sir J. BAIRD: Yes; but we must think not only of ourselves. The danger of crossing is shared by the public, and it would be an advantage that the subway could be used, not only by Members of the House, but by others.

Oral Answers to Questions — ROYAL AIR FORCE.

FAIR WAGES CLAUSE.

Mr. W. THORNE: 71.
asked the Secretary of State for Air whether Messrs. S. E. Saunders, Limited, Cowes, have a contract with his Department; whether the Fair Wages Clause has been placed in the contract; whether the firm are insisting that their workpeople should sign an undertaking not to belong to any trade union; if he is aware that the firm is not paying the recognised rates of the port with regard to apprentices on completion of their time; and if he will take action in the matter?

The SECRETARY of STATE for AIR (Lieut.-Colonel Sir Samuel Hoare): As regards the first two parts of the question, a contract has not yet been placed with Messrs. Saunders, but certain steps have been taken with a view to the placing of one, and any such contract will contain the usual Fair Wages Clause. As regards the third part of the question, the Air Ministry have no information as to the
firm's method of recruiting labour. As regards the fourth part of the question, investigation shows that the firm pay the full local rate of wages to both their skilled men and their apprentices, but that some question has arisen as regards the grade and pay of "improvers" between the ages of 21 and 22. As regards the last part of the question, the information appears to justify further investigation, and the matter is being take up with the firm.

AERIAL DEFENCE.

Mr. BATEY: 72.
asked the Secretary of State for Air what progress has been made by the Research Department towards defensive methods other than fighting in the air?

The UNDER-SECRETARY of STATE for WAR (Lieut.-Colonel Guinness): I have been asked to reply. One Regular and two Territorial Air Defence Brigades are in process of formation. Improvements in armaments and material are being developed, but I cannot in a Parliamentary answer give the technical details involved.

Mr. HANNON: Is not the amount appropriated to research work in the Air Service wholly inadequate for the purpose of that Service?

Lieut.-Colonel GUINNESS: I cannot answer about the Air Service. If the hon. Gentleman will look at the question, he will see that it is concerned with the steps taken in relation to defence from attack from the air, and that the organisation to which I am referring is the School of Anti-Aircraft Defence, and the Searchlight Experimental Establishment at Biggin Hill.

Sir H. BRITTAIN: What proportion of the numbers required for this anti-aircraft defence have been obtained?

Lieut.-Colonel GUINNESS: I should like notice of that question.

Mr. BATEY: Does the Minister remember that, when the Estimates were before the House, we were told that some of the money would be used for research, and I want to know whether any of that money has been applied to defensive methods rather than to fighting
in the air. His reply to my question did not seem to answer that point.

Lieut.-Colonel GUINNESS: Most certainly. Money is being spent on research, which is a very important subject; but, in view of the time of the House, I cannot now go into the organisation or the technical details.

Mr. BATEY: Is the whole of this money being devoted to the purposes of fighting, or of aggressive work, rather than for defensive methods—that is what I want to know?

Lieut.-Colonel GUINNESS: Most of this sum for research is in connection with our artillery and searchlight experiments, and various technical matters of the sort.

Mr. BATEY: Is any part of the money being used to find defensive methods, rather than those for fighting in the air?

Lieut.-Colonel GUINNESS: Yes.

Mr. BATEY: 73.
asked the Secretary of State for Air if he will state the number of men trained in the art of flying with the commercial air service and who could be utilised for the purposes of defence if it became necessary; and the number of air machines now used for the commercial air service that could be utilised for defence?

Sir S. HOARE: As regards the first part of the question, whilst 704 civilian pilots' licences have been issued during the last few years, only 104 of these licences are still current. As regards the second part of the question, there are 30 airworthy machines on the civil register which could be utilised for operational purposes in emergency, but I would add, in qualification of this figure, that the variety of types would cause difficulties in keeping the machines efficient under service conditions. In addition there are 50 airworthy machines which could be used for training but not for operations.

FRENCH AIR ESTIMATES.

Captain ARTHUR EVANS: 75.
asked the Secretary of State for Air if he has confirmation of the statement that on 28th June the French Chamber of Deputies raised the French Air Estimates
from 36,120,000 to 211,920,000 francs, which will mean an increase in the French Air Force to six times its present size; whether, in view of this new situation, he considers the proposed increase in the British Air Force to be of sufficient strength; and what steps does His Majesty's Government propose to take?

Sir S. HOARE: I would ask the hon. and gallant Member to put down this question again for one day next week, by which time I hope I may be able to give him some information.

Oral Answers to Questions — POST OFFICE.

CASH-ON-DELIVERY SYSTEM.

Colonel Sir ARTHUR HOLBROOK: 76.
asked the Postmaster-General whether it is proposed to establish a postal cash-on-delivery system: if so, whether the House will have an opportunity of discussing such a proposal before it is put into effect, and whether he is aware that, while such a system might be advantageous to large mail order stores, it would be most prejudicial to the interests of country traders?

The POSTMASTER-GENERAL (Sir Laming Worthington-Evans): It is not proposed to establish a general postal cash-on-delivery service. I am considering whether it would be possible and useful to set up a system limited to agricultural produce.

EMPIRE WIRELESS CHAIN.

Mr. MACLAREN: 78.
asked the Postmaster-General if the licence which the Government is granting to the Marconi Company, in order to enable the said company to establish an Empire wireless chain, contains Clauses which preclude the Government or any wireless company from establishing similar wireless communications?

Sir L. WORTHINGTON-EVANS: The terms of the proposed licence are under discussion with the Marconi Company. It will certainly contain no provisions precluding the Government or other companies from establishing similar wireless communications.

Oral Answers to Questions — ALIEN IMMIGRATION (DOMESTIC SERVANTS).

Sir A. HOLBROOK: 79.
asked the Minister of Labour if he is aware that a party of domestic servants, recently sent to this country from Scandinavia, were refused permission to land; and whether he will consider the desirability of permitting the admission of women willing to accept domestic service?

The PARLIAMENTARY SECRETARY to the MINISTRY of LABOUR (Mr. Betterton): The particulars in the first part of the question do not enable me to identify the case, and if the hon. and gallant Member can supply me with further details, I will have inquiries made. Under Article 1 (3) (b) of the Aliens Order, 1920, permits from this Department are necessary for the admission of alien domestic servants, as for all other classes of employés.

Oral Answers to Questions — LOCAL AUTHORITIES (NECESSITOUS AREAS).

Mr. IRVING: 82.
asked the Minister of Health whether, in view of the urgent importance of the matter to the Poor Law authorities concerned, he is yet in a position to announce the decision of the Government upon the revised formula submitted to him on behalf of the representatives of necessitous areas for assisting them financially during the present time of unexampled destitution?

Mr. WALLHEAD: 85.
asked the Minister of Health whether he is aware that the local governing bodies of the necessitous areas are very anxiously awaiting his formula for the relief of such areas; and whether, in order to allay such anxiety, he is now in a position to state what his proposals are?

The MINISTER of HEALTH (Mr. Neville Chamberlain): I am afraid I can add nothing to the reply given to previous questions—that this matter is still under consideration.

Oral Answers to Questions — MATERNITY AND CHILD WELFARE (MILK).

Mr. LANSBURY: 83.
asked the Minister of Health whether he will tell the House the quantity and money value of milk
Supplied to mothers and children during the quarter ending 31st March, 1921, 1922, and 1923, in the City of Birmingham, County Borough of West Ham, Borough of Poplar, and City of Swansea?

Authority.
Quarter ended 31st March, 1921.
Quarter ended 31st March, 1922.
Quarter ended 31st March, 1923.


Quantity.
Money Value.
Quantity.
Money Value.
Quantity.
Money Value.




£

£

£


Birmingham
…
Liquid Milk, 55,128 pts.
792*
Nil.
—
Nil.
—


West Ham
…
Dried Milk, 17,420 lbs.
1,347
Dried Milk, 22,327 lbs.
1,188
Dried Milk, 51,647 lbs.
2,300


Poplar
…
Dried Milk, 356 lbs.
7,527
Dried Milk, 325 lbs.
2,782
Dried Milk, 454 lbs.
2,077




Liquid Milk, 344,694 pts.
Liquid Milk, 155,418 pts.
Liquid Milk, 136,696 pts.


Swansea
…
Dried Milk, (Sold) 3,298 lbs.
365
Dried Milk, (Sold) 3,408 lbs.
350
Dried Milk, (Sold) 2,968 lbs.
249




Dried Milk, (Free) 3,225 lbs.
355
Dried Milk, (Free) 4,278 lbs.
440
Dried Milk, (Free) 1,536 lbs.
130




Liquid Milk, (Free) 5,461 pts.
121
Liquid Milk, (Free) 4,848 pts.
78
Liquid Milk, (Free) 5,595 pts.
82


* This is the amount paid by the Corporation only, and not the total value of the milk supplied, some of which was partly paid for by the recipients.

Oral Answers to Questions — TUBERCULOSIS.

Mr. WALLHEAD: 84.
asked the Minister of Health what is the ascertained number of cases of tuberculosis for Wales and England, respectively; and what is the amount of accommodation for such cases in public sanatoria, respectively?

Mr. CHAMBERLAIN: I am sending the hon. Member particulars as to the numbers of notifications of, and deaths from, tuberculosis during the last five years in England and Wales. As regards the second part of the question, the residential institutions in England approved by my Department for the treatment of tuberculosis contain about 19,730 beds, and those in Wales about 1,315.

Oral Answers to Questions — COAL INDUSTRY.

OUTPUT AND ROYALTIES (WALES).

Mr. WALLHEAD: 90.
asked the Secretary of Mines the total coal output for Wales for the year ending 31st March,

MR. CHAMBERLAIN: As the answer involves a tabular statement, I propose, with permission, to circulate it in the OFFICIAL REPORT.

Following is the statement promised:

1923; what was the total amount of royalties paid; and what was the amount of such royalties paid, if any, towards the burden of the local rates of the districts from which such royalties were derived?

Lieut.-Colonel LANE-FOX: The total output of coal in North and South Wales (including Monmouthshire) in the year ending 31st March, 1923, was 55,191,000 tons, and the total royalties paid approximately £1,771,000. Royalties are not assessable to local rates in Wales.

COKE (EXPORTS).

Mr. SMEDLEY CROOKE: 88.
asked the Secretary for Mines the average cost of coke per ton at ovens in this country, the average price f.o.b. of export coke, and the total amount of coke exported during the first quarter of 1922 and 1923, respectively?

The SECRETARY for MINES (Lieut.-Colonel Lane-Fox): As the reply to this question involves a statistical statement I will, with my hon. Friend's permission, circulate it in the OFFICIAL REPORT.

Following is the reply:
The following statement gives the average price f.o.b. of export coke and

—
Total amount of coke exported.
Total value.
Average value per ton (f.o.b.).


1st Quarter, 1922.
Tons.
£
s.
d.


Gas coke
…
…
…
…
226,068
345,046
30
6


Other sorts
…
…
…
…
296,289
451,088
30
5


Total coke
…
…
…
522,357
796,134
30
6


1st Quarter, 1923.






Gas coke
…
…
…
…
294,553
428,941
29
2


Other sorts
…
…
…
…
489,237
863,654
35
4


Total coke
…
…
…
783,790
1,292,595
33
0

I regret that I have not the necessary information to enable me to give average quarterly figures of the price of coke at ovens.

Oral Answers to Questions — TIDWORTH GARRISON MARKET.

Sir A. HOLBROOK: 91.
asked the Under-Secretary of State for War whether he is aware that the rents paid by the stallholders in the Tidworth garrison market have been recently raised; whether an extension of time can be granted before such notices become operative; and whether he is aware of an order recently given prohibiting the holders of refreshment stalls from selling refreshments for consumption in the market?

Lieut.-Colonel GUINNESS: I am aware that instructions of the character indicated were issued locally, but the operation of those instructions was suspended some weeks ago, pending investigation by the War Office. That investigation is still proceeding, and meanwhile the local instructions remain in suspense.

Oral Answers to Questions — MEMBERS OF PARLIAMENT (WRITS AND RETURNS).

Mr. THORNTON: 92.
asked the Secretary of State for the Home Department whether the recent discoveries of writs and returns of early Members of Parliament are being issued as a Parliamentary Paper similar to Parliamentary Papers Nos. 69-69 (ii), of 1878, and 169, of 1891?

the total amount of coke exported during the first quarters of 1922 and 1923 respectively.

The SECRETARY of STATE for the HOME DEPARTMENT (Mr. Bridgeman): No decision has been taken in the matter, but it will be considered.

Oral Answers to Questions — WAR MATERIAL DISPOSAL (QUEEN'S FERRY).

Sir CHARLES CAYZER: 94.
asked the Financial Secretary to the Treasury whether his attention has been called to the methods of disposing of War material at the Government factory at Queen's Ferry; whether the present practice is to load it into motor lorries and send it by road to Morecambe, there to be transferred to barges and dumped into the sea; if he will explain why the material is not loaded direct on to barges on the Dee, thus saving much public money; and whether he will institute an official inquiry into the whole procedure?

Sir W. JOYNSON-HICKS: The method of transport adopted for the removal of this material was decided on after the most careful consideration by a technical committee advising the Disposal and Liquidation Commission. I should be glad if my hon. Friend would see me on this matter.

SHOPS (EARLY CLOSING) ACT (1920) AMENDMENT BILL,

"to extend the hours during which sweets, chocolates, and certain other articles may be sold to the public," presented by Mr. BECKER; supported by
Colonel Sir Arthur Holbrook, Mr. Lort-Williams, Colonel Grant Morden, Mr. Frank Gray, and Major Paget; to be read a Second time upon Monday next, and to be printed. [Bill 183.]

STANDING ORDERS.

Resolution reported from the Select Committee:
That, in the case of the Ministry of Health Provisional Orders (No. 9) Bill [Sheffield (Water) Order], Petition for dispensing with Standing Order 123, in the case of the Petition of 'the Sheffield Property Owners' Protection Association,' against the Bill, the Standing Order ought to be dispensed with.

Report to lie upon the Table.

RENT AND MORTGAGE INTEREST RESTRICTIONS BILL.

Reported, with Amendments, from Standing Committee D.

Report to lie upon the Table, and to be printed. [No. 93.]

Minutes of the Proceedings of the Standing Committee to be printed. [No. 93.]

Bill, as amended (in the Standing Committee), to be taken into consideration upon Monday next, and to be printed. [Bill 182.]

Orders of the Day — FINANCE BILL.

As amended, considered.

NEW CLAUSE.—(Relief from Entertainments Duty.)

(1) Entertainments Duty within the meaning of Section one of the Finance (New Duties) Act, 1916, as amended by any subsequent enactment, shall not be charged on payments for admission to an entertainment as respects which it is proved to the satisfaction of the Commissioners of Customs and Excise—

(a) that the entertainment is provided by a society which is not established or conducted for profit; and
(b) that the society by which the entertainment is provided is a society established solely or partly, either—

(i) for the purpose of promoting the interest of any industry; or
(ii) for the purpose of promoting graphic art, sculpture, or arts craftsmanship; or
(c) that the entertainment consists solely—


(i) in the case of a society of the description mentioned in paragraph (b) (i) of this Sub-section, of an exhibition of the products of the industry for promoting the interest of which the society exists, or of materials, machinery, appliances, or foodstuffs used in the production of those products, or displays of skill by workers in the industry in work pertaining to the industry; or
(ii) in the case of a society of the description mentioned in paragraph (b) (ii) of this Sub-section, of an exhibition of works of graphic art, sculpture, and arts craftsmanship, or of one or more of such classes of works, executed and exhibited by persons who practice graphic art, sculpture, or arts craftsmanship for profit and as their main occupation, or of displays of skill by such persons in such arts or crafts; or
(iii) in the case of a society of the description mentioned in paragraph (b) (iii) of this Sub-section, of an exhibition of articles or displays of skill which are of material interest in connection with questions relating to the public health;

or consists solely of such exhibitions or displays of skill together with a performance of music by a band.

(2) In this Section—
The expression "sooiety" includes a company, institution, or other association of persons by whatever name called;
The expression "industry" includes a branch of an industry and includes agriculture;
The expression "agriculture" includes horticulture and live stock breeding:
The expression "live stock" includes animals of any description.—[Sir W. Joynson-Hicks.]

Brought up, and read the First time.

The FINANCIAL SECRETARY to the TREASURY (Sir William Joynson-Hicks): I beg to move, "That the Clause be read a Second time."
When this Measure was last before the Committee I had the privilege, on behalf of the Chancellor of the Exchequer, of announcing certain concessions on the Financial Clauses. I am glad to have the opportunity now of moving the necessary new Clauses to give effect to the concessions which were then announced. The new Clause, the Second Reading of which I am now moving, deals with the Entertainments Duty, and this arose in consequence of an Amendment put forward by some of my hon. Friends, including the right hon. Gentleman the Member for Chelmsford (Mr. Pretyman), to the effect that agricultural shows where they have a band should be exempted from the duty. I accepted that Amendment, but after going more closely into the matter I find that there is no reason why we should not exempt other things. We could not very well allow this concession in the case of a band at an agricultural show and not allow it in the case of a public health exhibition or an industrial exhibition. I have now drafted the new. Clause wide enough to allow bands at all those exhibitions. We have also gone a little further in the direction of exempting certain other institutions from these irritating restrictions and we have kept them out of the purview of the Entertainments Duty. I do not think that the loss to the Exchequer will be very great, and the concession will be most useful to those people who want to organise these various entertainments. The original Clause did not include entertainments
held in connection with the mining and the fishing industry, but these are exempted under this new Clause.
The original Clause was held to apply to picture exhibitions, but not to wood carving or enamelling, but I want to sweep all these restrictions away. There was another part of the Clause which provided that the exhibition organised by a society should be solely far the purpose of looking after a particular industry. The result of that was that if a horticultural show was held in a village and was run by the local horticultural society it was free of the Entertainments Duty, but if the same show were run by a women's institute in the village, it was not free of the duty. I have swept that away. It was also curiously held in regard to industrial shows that the products of the industry could be exhibited but not the skill of the operator. The most astonishing thing in connection with that was that, although you might exhibit milk, for instance, you could not have an exhibition of milking at an agricultural show. That we have swept away also. Lastly, there was the point raised by my right hon. Friend the Member for Chelmsford with regard to driving and riding competitions at agricultural shows. These will also be swept out of the purview of the Entertainments Duty, provided they are in connection with the improvement of the breed of horses. If the riding and driving competitions are competitions of horses and not of drivers or riders then they will be free from the duty, but if, on the other hand, they are in the nature of a circus, where two or three men, one after another, exhibit the same horse jumping, to show the skill of the men, that would be an entertainment and it would have nothing to do really with improving the breed of horses. I am trying to deal with all these matters in one Clause. The whole of these anomalies will be cleared away, and I hope it will make things a good deal easier, not merely for industrial, but also for agricultural shows throughout the country.

Mr. T. GRIFFITHS: I would like to ask as to musical entertainments in schools and at festivals. Will they be brought under these exemptions? If you have a performance given by school children, I think the possession of a
certificate of the Board of Education should free it from the duty. Then, again, with regard to musical festivals; people in different districts in Wales are trained perhaps for 12 months and at the end of the time have a musical festival. It is a labour of love; indeed, they incur considerable personal expense, and—[HON. MEMBERS: "Speak up!"]—I think they should be exempted. [HON. MEMBERS: "We cannot hear you!"] You keep quiet, I am speaking loudly enough. What I am trying to point out is that in these cases the schoolmaster may give his spare time for 12 months to training the children, and they ought to be allowed to have their entertainment at the end of that period free of the duty. Surely this class of entertainment is entitled to be exempted.

Colonel Sir CHARLES BURN: Has the right hon. Gentleman considered the case I sent to him of a school treat at which there is an inclusive charge for tea? I wrote him a letter a few days ago, giving him details, and I got a very charming reply, saying that the matter would be very carefully considered. This is a really genuine case for exemption. A school treat is not a money-making business. The sole object is to give pleasure to the children and their relatives, and I hope the right hon. Gentleman will decide in favour of exemption in these cases.

Mr. ERNEST EVANS: I wish to call attention to the case of musical festivals arranged by schools. I want to draw particular attention to an institution which has been formed in Wales and which for some years has been doing a very great educational service to the country. I refer to the National School of Music which is associated with the University of Wales and is directed by Dr. Walford Davies. It is of great educational value. It sends lecturers throughout the country. What usually happens is that, in the afternoon, the lecturer, who is sent out by the University, will deliver a lecture illustrated by either vocal or instrumental music. Then in the evening there is a public performance. As far as the lecture is concerned, no charge is made for admission, but at the evening performance there is a small charge. There is, however, no idea of making a profit in the matter from beginning to end. The school I am
referring to was started by people interested in music for the purpose of educating the Welsh people, who are supposed to have a certain aptitude for music. The whole purpose of the school is educational. We have been trying to get its entertainments exempted from the duty, so far without success, and the ground on which we have been refused is that they are entertainments, pure and simple. It seems rather extraordinary to lay it down that, because a thing is enjoyable, therefore it cannot be educational. We have heard of boys in schools enjoying their education, and surely, to lay it down that a thing which is enjoyable is not educational, is an extraordinary position for a great country like this to take up. A very great injustice is being done to this school, which owes its existence to the munificence of Members of this House and others interested in music, and it is not right it should be penalised by having to pay the duty on its performances, which are entirely educational.

Mr. EDMUND TURTON: I thank my right hon. Friend for having so loyally carried out his pledges to the Committee, and I can assure him his concession will give very great relief to the smaller agricultural societies. I am particularly glad for the concession he has made in regard to exhibitions of milking and horse shoeing. I had brought to my notice only last year the very hard case of a small agricultural show which, because of the Entertainments Duty, could not afford to engage a band, but which, because it had an exhibition of shoeing horses by three or four shoeing-smiths was swooped down upon by the Government and made to pay the duty. I am very glad that my right hon. Friend has met what was a real grievance, and I beg to thank him most heartily.

4.0 P.M.

Mr. MOSLEY: I only rise to ask the right hon. Gentleman whether this Clause covers an Amendment which I have on the Paper in relation to school sports?

Sir W. JOYNSON-HICKS: No, the hon. Member can move that Amendment later.

Mr. HILL: I wish to ask a question relating to flower shows. The Corporation of the City of Leicester for many years have been responsible for holding a flower
show, the profits from which have been devoted to the provision of public music in the parks. We are rather anxious to know exactly where we stand with regard to those shows. We have also held swimming sports. There are no profits made. Every halfpenny made out of these flower shows and swimming sports goes towards the provision of music in the parks, and I may say that the rates have been saved many thousands of pounds as the result.

Sir JOHN BUTCHER: I desire to associate myself entirely with what has fallen from my hon. Friend the Member for Thirsk (Mr. Turton) in thanking the Chancellor of the Exchequer and the Financial Secretary for the concession which they have made with regard to agricultural shows. I doubt not that it will be appreciated all over the country, and I am quite sure that there is no place where the concession will be appreciated more than in Yorkshire itself. There is one not wholly unimportant point in this Clause relating to relief from the Entertainments Duty, to which I should like to call attention. By the Clause as it stands, if a society which is not run for profit holds an art exhibition, where the exhibitors are entirely professional, then it is exempt from the Entertainments Duty, but if any of those art exhibits be produced by amateurs, then the exhibition is subject to the duty. I venture to think that is a defect in the Clause as it stands which requires amendment. These art exhibitions are not only exempted from the duty in the interests of the exhibitors, but also in the interests of the public at large. The art exhibitions have a great educational value, particularly in the provincial towns, and cause a great deal of interest from a purely educational point of view among the citizens in the places in which they take place. Therefore, it appears to me most important to encourage these art exhibitions by societies not formed for profit in every possible way, and I am going to ask my right hon. Friend to extend the exemption which is now granted to exhibitions where the exhibitors are entirely professional to exhibitions where there are some amateurs as well.
I may tell my right hon. Friend that I have already come across a case in which this has been of considerable importance. There was an art exhibition in the City
of York this year. There were a considerable number of exhibits by professional men and there were also a few by amateurs. On writing to the Customs Department, or whatever was the proper office, the Secretary was told that they could not have exemption, because there were amateurs exhibiting at the exhibition. I appeal to my right hon. Friend that he might make this concession. I do not think that it would cost him much—I should think it would cost an infinitesimal amount—and by doing so he would give great satisfaction to many persons in the places where these exhibits are held. I, therefore, hope that he will give me a favourable answer. I have an Amendment down on the Paper to this effect, but, if the Clause were carried in its present form, I should be unable to move it. Therefore, I propose, after the Clause has been read a Second time, to move to omit paragraph (ii) of Sub-section (1) in order to carry out my object.

Colonel WOODCOCK: May I ask the right hon. Gentleman whether we may understand that the words of paragraph (iii) of Sub-section (1),
displays of skill … in connection with questions relating to the public health,
include swimming entertainments? Swimming entertainments were mentioned a moment or two ago by my hon. Friend the Member for West Leicester (Mr. Hill). May I say that swimming clubs have done a great deal of good in promoting swimming, which is not only a healthy exercise, but a most useful thing in saving life and enabling children to save themselves. Swimming clubs have very small incomes, and they rely on their entertainments, in many cases, to keep going. During the last few years some of them have had to close down, because the Entertainments Duty has swallowed the whole of their profits. If swimming entertainments be allowed free of the duty, then a vast amount of good will be done in encouraging the teaching of swimming.

Major McKENZIE WOOD: Like all the other Members who heard the announcement by the right hon. Gentleman some time ago, I was very glad, because I thought that it was going to help all these
agricultural associations which are having their shows at the present time. Since then, however, I have come to have some doubts as to whether the concession is as real as it at first appeared to be. I had a case submitted to me, and I passed it on to the Treasury, who sent it to the Customs Department. I have now been informed that it is not entitled to the exemption. As far as I can see the show is an ordinary country agricultural show with exhibitions of cattle and horses, and ending up with a few competitions. The reply which I have received simply says that the exemption will not apply in this particular instance. At the present time there are shows being arranged all over the country. I am quite certain that the committees of these shows, in most cases, will be ready to drop one or two items if a clear indication be given as to what items debar them from getting this exemption. I am quite sure that the Treasury desire to help these associations, and my suggestion is that they should do something to give these committees and associations a clear indication as to what they can do. If a clear indication were given now, it would help a great number of these associations who at the present time are drawing up their programmes and are at a loss to know how to proceed.

Mr. LAMB: As an agriculturist and a Member of the Agricultural Committee, I should like to thank the right hon. Gentleman for the way in which he has met the representations made by the Agricultural Committee on this question. There is one other item which I should like him to clear up, namely, the question of educational exhibits at agricultural shows. I am a Member of the Education Committee and of the Agricultural Society of my county, and we have for many years had very extensive exhibitions of the work which has been done by the children in the rural schools and by the pupils at the farm schools and at the County and Provincial College. We have recently had a notification from the Excise Department that if we continue to hold these exhibitions we shall not be exempt from the Entertainments Duty. I sincerely hope that the right hon. Gentleman will clear up this matter—I have given him full particulars—so that we may have it settled once and for all that exhibitions of work done by children in rural schools shall not be debarred from the benefit of this concession. I may
say that we make no charge for admission. We make arrangements that the children of the various schools shall attend the exhibitions under their respective teachers free, and that the parents also may visit them and know the work which is being done and which is of considerable value in the county.

Mr. HINDS: I am sure this concession which has been made with regard to agricultural shows will be well received in all parts of the country, but I wish to reinforce the point made by the hon. Member for Pontypool (Mr. Griffiths) with regard to school children's concerts and also the recitals in connection with the school of music and the University of Wales. We are very glad to know that a band is to be allowed in connection with agricultural shows, but, if there be a choir of the children in the place of a band, then apparently the Entertainments Duty is to be charged. Why in the world should there be that difference? We like to hear the voices of the children just as much as the music of a band. The request of the hon. Member for Pontypool, therefore, is a reasonable one, and I am sure that the right hon. Gentleman will see the consistency of meeting the point. All these concerts and recitals bring in very little money. They are often given for charitable purposes—for hospitals and infirmaries and so on—and to charge people who have worked very hard in connection with them is very irritable indeed. I desire to ask the right hon. Gentleman to reconsider the question of these musical recitals in connection with the school of music and the University of Wales. Dr. Walford Davies works very hard, and these recitals are given to show what the pupils can do at the end of the term and to make these concerts subject to a duty of this kind is neither right nor proper. I do therefore appeal to the right hon. Gentleman to sweep away all these irritating points which have been so obnoxious.

Major RUGGLES-BRISE: Would the right hon. Gentleman give a clear indication as to what is meant by paragraph (iii) of Sub-section (1),
for the purpose of promoting public health"?
Do these words cover athletic sports held at horticultural shows? They are a very necessary adjunct as making for the success of these shows, and it would be
a thousand pities if there were any doubt left in the minds of those who are now making their final arrangements for the shows to be held during July and August as to whether or not they are to be permitted to have athletic sports in connection with the shows. I hope very much that the right hon. Gentleman may be able to assure the House on that point, and that a very useful means of promoting public health may not be taxed in future.

Mr. CLYNES: Probably the House will have to be content with the concessions already announced in the proposed new Clause, and I rise only to ask whether the Financial Secretary does not now recognise that the almost unanimous sense of the House is in favour of wider and more substantial concessions than have yet been indicated. I should like to join in the appeal which the hon. Member for Carmarthen (Mr. Hinds) has made for more reasonable treatment of this question by the Government in the future. While I think that, in general, the permanently established institutions for entertainment — theatres, concert halls, cinemas, and so on—have a real grievance in this matter, I think that, apart from the question of giving any substantial relief to these institutions just now, it would be proper that the Government should recognise that at least those purely temporary and occasional forms of entertainment which are not organised primarily for the purpose of making a profit, but for the purpose of carrying on a custom or meeting local necessities, should be entirely exempt from the Entertainments Duty. I suggest that concerts or entertainments or other ventures of that nature, which are not carried on in the ordinary trade or commercial sense, were never intended at the beginning to be subject to the Entertainments Duty, and that, therefore, where they are only occasional and intermittent, and are carried on for non-profit-bearing purposes, they ought to be free from this particular duty.

Lieut.-Colonel HOWARD - BURY: I only want to raise one definite point, and, in doing so, I associate myself with some of the other hon. Members who have already spoken. This month and next month a number of horticultural and flower shows will be held, and I would
ask for a definite ruling as to what exactly will be the nature of the exemption in the case of these shows. I have already received various letters asking me whether this or that show will be exempted. I have one here from a farmers' and market gardeners' protection society. This society holds a flower show once a year, and gives prizes for allotment gardens, allotments on waste lands, and children's gardens. In order to make it a success they have a band and sports, and I understand that the fact of their having sports rules them out of the operation of this Clause. I do not know whether it would be possible to stretch Sub-section (1, c), which refers to displays of skill. I do not know whether sports can be looked upon as displays of skill, but if the sub-section could be stretched to that extent I think it would meet with the approval of a great many Members of this House. These flower shows are run purely for the purpose of the improvement of gardens and to encourage the growing of flowers throughout the country. Such work is especially necessary in the Black Country, a portion of which I represent and I would ask the right hon. Gentleman to do what he can to give this exemption. It is not from these shows that the large proportion of the duty is obtained, but from theatres and cinemas. This small concession would cost only a few thousand pounds a year, but it would prove of infinite advantage to those who organise these shows, and I would ask the right hon. Gentleman to give us a definite ruling in regard to them.

Mr. WALLHEAD: I desire to support the plea that has been made for the removal of the tax upon such things as school entertainments. It is good that the improvement of horse-breeding should be encouraged, and also that encouragement should be given to the exhibition of flowers, but it does not seem to me to be quite logical, while admitting that the tax should be removed from shows of that description, to put it upon the cultivation of the human voice and the encouragement of music. I speak for a constituency in a country where choral singing is a marked feature of the social life of the people. The school children are encouraged to go in for choral and individual singing, and it seems to me to be
unwise to put a tax upon the admittance of the parents and friends of the children who go to see them begin their career as vocalists and instrumentalists, in the towns of South Wales in particular. I plead with the right hon. Gentleman to see his way to removing the tax in these cases. I do not think he will derive a great amount of money from entertainments of that description. Again, it seems to be out of all proportion, in the case of educational entertainments, to take ½d. in the case of a 2d. entertainment. A tax of 25 per cent. is out of all proportion in such a case, particularly where the entertainment is of a purely educational character. If the right hon. Gentleman could see his way to removing this vexatious tax, of which, probably, in the cases to which I am referring, one-half goes in expenses of administration and collection, I am sure it would be a boon to the large number of people concerned, and a credit to his own office.

Captain BERKELEY: I am anxious to enlist the sympathy of the Financial Secretary for a type of society which is not established or conducted for profit, and which, therefore, comes within the first paragraph of Sub-section (1) of this Clause, but which seems to be barred by the qualifications laid down in the other two paragraphs. The particular society I have in mind is one in which I personally take a great interest, and in which, I believe, the Financial Secretary also takes a great interest, namely, the League of Nations Union. It might quite well happen that such a society, for the purposes of its educational work in the country, might wish to arrange an exhibition or some similar entertainment, and it seems to be to be perfectly reasonable to ask that some allowance should be made in this new Clause for meeting such a case. There are other societies besides the League of Nations Union which are entitled to consideration. There are, for instance, the Society for the Prevention of Cruelty to Animals, the Aborigines Protection Society, and so on. Such societies are not conducted for profit, but for educational purposes, and I hope the right hon. Gentleman will be able to see his way to insert in the Clause such modification as may be necessary to meet these cases. As regards the particular class of exhibitions to which most reference has been made, namely, horticultural societies' exhibitions, these will
soon be taking place in large numbers, and I should like to ask whether it would be possible to insert in this new Clause a provision that it shall have effect as from the date on which it receives the approval of this House, so that it may not be held over until the Finance Bill has received the Royal Assent.

Captain TERRELL: I should like to associate myself with those hon. Members who have been pressing the Government to remove the Entertainments Duty from horticultural shows, even though they include sports. I do so for two main reasons. In the first place, sports, in connection with these shows, are somewhat of the nature of an advertisement, the object of which is to attract people to the shows, and there is no doubt that that is the main object of holding sports in such cases. In the second place, it seems a pity to interfere with any of these shows, which do much to brighten up the life of those who live in the villages in agricultural districts. At the present time it is very hard indeed to get enough people to live in rural districts. On these two grounds I would ask the right hon. Gentleman, if possible, thus to extend the concessions which he has already made. Of course it may be said that it would cost too much. Perhaps the right hon. Gentleman, in his reply, would tell us exactly how much it would cost if the Government were to stretch a point and remove the Entertainments Duty entirely from horticultural shows.

Mr. LAMBERT: I am very grateful to to the right hon. Gentleman for this concession, but I should like him, in his own interest, to make it clear exactly how far it goes. In regard to agricultural societies, in which I am specially interested, it is not clear, and I feel quite certain that what will happen will be that societies which have arranged their exhibitions will expect, from the announcement of the Government, not to be called upon to pay Entertainments Duty, and that they will then suddenly be swooped down upon by some Revenue officer, and great will be their indignation when they find that they are liable. When will this concession take effect? Assuming that an agricultural show is held now, in the month of July, will it be free of tax? I should also like the right hon. Gentleman to give a clear definition of the kind of societies to which the con-
cession will apply. In an instance that was given by an hon. Member just now, a pony race was included. I can see the difficulties that the Treasury would have in making exceptions, and can understand that, if they excluded a pony race, they might have to exclude some great race meeting. What I should like the right hon. Gentleman to do, however, is to give a clear definition, for the benefit of the agricultural societies in the country, of exactly what is taxable and what is not taxable, so that they may clearly understand. If, after reading the concessions which the Government are making, they find themselves suddenly called upon to pay the tax, they will feel that they have a great grievance. Among the exemptions included in the Clause is a display of skill by the workers in the industry concerned in work pertaining to the industry, but I assume that trotting competitions at an agricultural show would be excluded. That is one of the things that I want to know. Another instance that was mentioned was a foot race for agricultural labourers. These are difficult questions, but I would ask my right hon. Friend, in his own interest and in the interest of the Government, to make matters as clear to us as he can, because I am quite certain that there will be immense dissatisfaction in the agricultural community if, when they have been thinking that they are excluded, they are suddenly called upon to pay the tax.

Brigadier-General CLIFTON BROWN: I agree with the right hon. Gentleman who has just spoken, that we ought to have a clear definition of what is included and what is not. I understood the Financial Secretary to say that in the case of horse shows some might be taxed and some might not—that if a show were connected with horse-breeding it might go untaxed, but that anything in the nature of a circus would be subject to the duty. Has my right hon. Friend thought under what category a thing like the Royal Military Tournament comes under—an annual affair to help military and naval charities and to help the training of the Army and the Navy?

Lieut.-Colonel WATTS-MORGAN: I agree with what has been said by my hon. Friends with regard to musical entertainments, but there is a further point I should like to put to the right hon.
Gentleman. Some of us who are deeply interested in ambulance work, especially in connection with mining and railways and so forth, have promoted societies, mainly of the Order of St. John of Jerusalem. We find we have been hampered in promoting competitions, which we hold three or four times every year. There are expenses, although we get contributions from other sources, and we have to make a little charge, and if there is a band, and especially if we have foot racing competitions, which are tests of endurance and skill, I want to know if they will come under the purposes of promoting the public health in Sub-section (1, iii).

Sir W. JOYNSON-HICKS: A good deal of misapprehension appears to exist. This Clause does not deal with charities at all. It is an industrial Clause dealing with industrial, agricultural, trade and mining shows, and things of that kind. Questions of charity—and the military tournament is a charity—all come under another Clause of the existing law, and they are exempt under certain conditions which were fully debated in Committee. With regard to the Welsh question of song, I remember a most eloquent speech by the hon. Member for Pontypool (Mr. Griffiths) on the Committee stage, in which he spoke of the sea of song drying up and degenerating into a small trickle. That does not come under this Clause. In the case of flower shows, horticultural shows and agricultural shows, the whole question depends upon whether the show is really for the purpose of improving horticulture or agriculture, or whether it is an entertainment, pure and simple. I have had given me by the hon. Member for Central Aberdeen (Major McKenzie Wood) a catalogue of an agricultural show. There are different classes of cattle, different classes of horses, different classes of sheep, and so forth, and then there is a series of afternoon events, some of which I am quite clear do not come within the conditions of this Clause. For instance, a Shetland pony race I do not think could be said to come within the conditions of an agricultural show, and you can hardly say musical chairs on horseback has anything to do with improving the breeding of horses. It is a question of the skill of the man who
is riding, and in fact it is a pure bona fide entertainment to attract people to the show. If you want an agricultural show to be exempt from Entertainment Tax, it must be purely an agricultural show and must not have side shows with musical chairs on horseback, pierrots, fat women or anything of that kind. All these must really be swept out if you want exemption from the tax.

Mr. LAMBERT: In the case of an ordinary agricultural show, if you have a jumping competition or a trotting competition, is there anything in the Clause to prevent it being exempted?

Sir W. JOYNSON-HICKS: Not at all. If there were three or four men riding the same horse, the prize being given to the man who jumped best, that would not be exempt, but if it is jumping to encourage proficiency in the breeding of hunters and so forth, that is an agricultural purpose, and it would be exempt. A trotting competition in the same way.

Captain O'GRADY: You exempt the fat woman at the show at the Empire Exhibition. There is a Clause especially for that purpose.

Sir W. JOYNSON-HICKS: When we come to the Clause relating to the Empire Exhibition the hon. Member can put a question.

Mr. BATEY: Sports?

Sir W. JOYNSON-HICKS: Sports are clearly an entertainment, and do not, and cannot, come within the provision of this Clause.

Mr. BATEY: Then the concession means nothing.

Sir W. JOYNSON-HICKS: If the hon. Member does not like it, he can vote against it. I have taken a great deal of trouble to try to clear away many of the difficulties of this Entertainments Duty. It is not encouraging the Minister. I had given no promise in regard to many of these questions. I have only given one promise in regard to the band at agricultural shows. When I inquired into it, I found there were a great many small and irritating questions which could be removed for the benefit of agricultural and horticultural shows, and then hon Members suggest that the Clause is no good at all. Then there
is a question raised by the hon. and learned Member for York (Sir J. Butcher) about professional and amateur. There we come to a very difficult question where to draw the line. My hon. and learned Friend wrote me fully on the subject, and when I read his letter I was rather concerned. This is really an industrial Clause for the encouragement of trade and commerce, and I had to draw the line somewhere. One cannot say amateur shows are really for the improvement of trade and commerce and they should be subject to Entertainments Duty, because they are really in the nature of entertainments. Where they are trade shows, whether agricultural or motor shows or shows of any handicraft work for people who have to earn their living, I want to exempt them from the Entertainments Duty.

Mr. BROAD: What about allotment shows by amateurs?

Sir W. JOYNSON-HICKS: Clearly shows of allotments come under horticultural shows.

Mr. BROAD: They are all amateurs.

Sir W. JOYNSON-HICKS: I admit the Clause is rather complicated. There are two heads to it. One relates to horticultural and agricultural shows and the other to trade shows. Horticultural shows come under one head and trade shows under another.

Mr. POTTS: Is the right hon. Gentleman of opinion that the training of hunters is a reasonable thing to put in?

Mr. TUBBS: Do we understand that if the circus stunt is eliminated from any of these local shows, they are exempt?

Sir W. JOYNSON-HICKS: An agricultural show, pure and simple, is exempt, but if the circus element is introduced into it, that makes it liable to Entertainments Duty. The hon. Member opposite can know very little about horse breeding. One of the main avenues of horse breeding for farmers is the breeding of hunters, and if hunters have to be tested by their proficiency in jumping—I am speaking of the animal—that is distinctly an agricultural purpose and stands to benefit agriculture. I think I have answered all the questions put to me. If there is any doubt in the mind of any
hon. Member whether any particular show comes under these conditions, the best thing would be to write to the Board of Customs and Excise, and if he does not get a satisfactory answer he can write to me. The Clause might have come into operation sooner if hon. Members had not asked so many questions. As soon as the Bill passes it will come into operation.

Captain TERRELL: If the Entertainments Duty were removed altogether, even in cases where sports are held, how much would it cost the Exchequer?

Sir W. JOYNSON-HICKS: I do not know, because I have not gone into the question.

Mr. TUBBS: Having regard to the important question of getting out advertisements, as a large number of these shows take place in the August Bank Holiday week, could we have a definite understanding now that this will go through?

Mr. SPEAKER: That is a matter for the House.

Question, "That the Clause be read a Second time," put, and agreed to.

Clause read a Second time.

Sir J. BUTCHER: I beg to move, in Sub-section (1, c), to leave out the words,
(ii) in the case of a society of the description mentioned in paragraph (b) (ii) of this Sub-section, of an exhibition of works of graphic art, sculpture, and arts craftsmanship, or of one or more of such classes of works, executed and exhibited by persons who practice graphic art, sculpture, or arts craftsmanship for profit and as their main occupation, or of displays of skill by such persons in such arts or crafts; or.
This raises the question of exhibitions of amateurs. My right hon. Friend justified the Clause in its present form by saying exemption would be given to all exhibitions similar to that given to trade shows. I think these are at least similar as the case of horticultural exhibitions, where there is no difference made whether the exhibitors are amateurs or professionals. They are exempt from duty whether they are entirely one or the other or a mixture of both, and when my right hon. Friend says exemption is given to art exhibitions because they are in the nature of trade shows surely they are of an educational nature, perhaps at least as much as trade shows. Having regard to the fact that undoubtedly the
educational element enters into it would be not consider what the cost would be and if possible make that concession? I do not know whether it could be introduced in another place, perhaps it could; but I would ask the right hon. Gentleman, having regard to the educational value of these art exhibitions, to grant this exemption.

Major PAGET: I beg to second the Amendment.

Sir W. JOYNSON-HICKS: I am afraid the hon. Baronet's Amendment would defeat his purpose, because it would leave out paragraph (ii), and would take away the benefit which we have given to the professional people. That, clearly, would not do. I know what the hon. and learned Baronet means; he wishes to include within the terms of the concession the amateur art exhibitions. I explained in my last statement that I fear that is impossible. It all comes back to the old difficult question of where you should draw the line. If you included the amateur in what is really a concession for the benefit of the trade, then you have to admit the amateur all along the line. There, again, you would have to admit societies run by amateurs, whereas this is really a concession to the trade.

Sir J. BUTCHER: May I ask the right hon. Gentleman what is the distinction between this case and that of the horticultural exhibition? In both instances there are amateurs exhibiting.

Amendment negatived.

Clause added to the Bill.

NEW CLAUSE.—(Amendment as to allowance for repairs.)

(1)The following paragraphs shall be substituted for paragraphs (i) and (ii) of paragraph (1) (b) of Rule 7 of No. V in Schedule A (which relates to the allowance for repairs):

"(i) Where the owner is occupier or chargeable as landlord, or where a tenant is occupier and the landlord has undertaken to bear the cost of repairs, by a sum equal to the amount of the authorised reduction hereinafter mentioned; and
(ii) Where a tenant is occupier and has undertaken to bear the cost of repairs, by such a sum, not exceeding the amount of the authorised reduction, as may be necessary to reduce the amount of the assessment to the amount of rent payable by him;

Provided that the amount by which an assessment is reduced shall not, in the case of an assessment exceeding the amount of forty pounds, be less than it would have been if the amount of the assessment had been forty pounds."

(2) The following paragraph shall be inserted at the end of the said Rule 7:
(3) The authorised reduction for the purposes of this Rule shall be—

(a) Where the amount of the assessment does not exceed forty pounds: a sum equal to one-fourth part of the amount of the assessment.
(b Where the amount of the assessment exceeds forty pounds but does not exceed one hundred pounds: a sum equal to one-fifth part of the amount of the assessment.
(c) Where the amount of the assessment exceeds one hundred pounds: twenty pounds, together with a sum equal to one-sixth part of the amount by which the assessment exceeds one hundred pounds."

(3) Paragraph (2) of the said Rule 7 shall have effect as if after the words "one-eighth" there were inserted the words "below the rent" and as if for the words "is more than one-sixth below the rent" there were substituted the words "is less than the rent by a sum greater than the authorised reduction which would be allowable if the assessment were on the amount of the rent," and in paragraph (1) of Rule 8 of the said No. V in Schedule A for the reference to one-sixth part of the value there shall be substituted a reference to the authorised reduction.

(4) Nothing in this section shall affect the validity of any notice of assessment of annual value under Section thirty-two of the Finance Act, 1922, given before the commencement of this Act, but the occupier of any property, or the owner or other person in receipt of the rent of any property, who is aggrieved by the amount by which the assessment has been reduced for the purposes of collection under the provisions of Rule 7 of No. V in Schedule A, as amended by this Section, shall be entitled to appeal on the matter if he gives to the surveyor, not later than the fifth day of April, nineteen hundred and twenty-five, notice in writing of his intention to appeal, and on any such appeal the Commissioners shall make such amendment (if any) in relation to the reduction as the case may require, and the provisions of the Income Tax Acts relating to appeals against assessments to Income Tax under Schedule A shall, with any necessary modifications, apply to appeals under this Sub-section.

Provided that nothing in this Sub-section shall affect the collection or recovery of any tax assessed and charged, and where the amount of any reduction is increased on an appeal under this Sub-section any tax overpaid shall be repaid.

(5) This Section shall, unless Parliament otherwise determines, cease to have effect on the fifth day of April, nineteen hundred and twenty-eight.—[Sir W. Joynson-Hicks.]

Brought up, and read the First time.

Sir W. JOYNSON-HICKS: I beg to move, "That the Clause be read a Second time."
The fate which has attended my efforts with regard to the last Clause hardly encourages me in moving this one.—[HON. MEMBERS: "Oh!"]

Mr. LINFIELD: It might have been much worse!

Sir W. JOYNSON-HICKS: As the hon. Member says, it might have been much worse; he might have taken part in the discussion. I think this new Clause is one at which nobody will cavil; it is brought in to carry out the concession arranged on the Committee stage dealing with the allowance for repairs in regard to the re-assessment of house property. The existing rate is one-sixth, and we now propose to make allowances for repairs, in order to meet the increased cost, of one-fourth, where the house does not exceed £40 in value; one-fifth, on houses where the assessment is between £40 and £100; and on houses where the assessment exceeds £100, one-fifth up to £100, and one-sixth above that sum. This will make a very generous allowance for repairs, and will mitigate the hardships of the re-assessment which, undoubtedly, in some quarters have been felt to be too grievous to be borne. This carries fully out the concessions announced. I think it has been received with satisfaction by the House, and also by the country outside.

Mr. MOSLEY: When the right hon. Gentleman made his announcement in Committee, his concession was received with a universal chorus of approbation, which, he has just stated, he believes to have been re-echoed in the country. I ventured, on the Committee stage—I think almost alone—to criticise slightly the concession which he had made, and to point out that it really did not meet the case. I have since had a good many letters on this subject, bearing out that point of view. I do not intend to and shall not repeat at all the observations which I made on the Committee stage. I would merely say that I have received substantial confirmation of that point of view. The gravamen of the case is that the right hon. Gentleman's concessions are purely given with a view to facilitating appeals and to give those who con-
sider themselves oppressed a greater facility for making appeals and having their case considered. This concession does not in any way meet the real case, which is that the basis of valuation is utterly unintelligible, and that hardships and anomalies on a very large scale do exist. I have had innumerable letters bearing out that point of view, and reiterating the demand that has been made for a thorough inquiry into the basis of this transaction. I reiterate, without repeating the arguments which have been used so often, and the contention I have formerly urged, that by this means alone will the right hon. Gentleman escape the confusion and chaos of widespread appeals throughout the country.

Colonel NEWMAN: Like the hon. Member for Harrow (Mr. Mosley), I also have had some share in receiving correspondence about the reassessment, but I disagree with him altogether. Since my right hon. Friend made his concession, I have not had a single letter except of praise. I have had letters congratulating the right hon. Gentleman, and, in a small way, thanking myself. Latterly I have not had a single letter of objection in connection with the scale of Inhabited House Duty—I have had one or two small complaints about graduation. So far as I am concerned, my correspondence has dried up altogether. I have had letters of thanks to the right hon. Gentleman, and he deserves the thanks of the country.

Question put, and agreed to.

Clause read a Second time, and added to the Bill.

NEW CLAUSE.—(New scale of annual values for purposes of Inhabited House Duty.)

The enactments relating to inhabited house duty shall have effect as if for the references therein to annual values of, exceeding, or not exceeding, as the case may be, the several amounts specified in the first column of the following table there were substituted references to annual values of, exceeding, or not exceeding, as the case may be, the several amounts, respectively, specified in the second column of the said table.

TABLE.


Existing Annual Values.
Substituted Annual Values.


1. Twenty pounds.
1. Thirty pounds.


2. Forty pounds
2. Sixty pounds.


3. Sixty pounds.
3. Ninety pounds.


—[Sir W. Joynson.-Hicks.]

Brought up, and read the First time.

Sir W. JOYNSON-HICKS: I beg to move," That the Clause be read a Second time."
This Clause contains a new scale of annual values for the purposes of Inhabited House Duty. I hope that the hon. Member for Harrow (Mr. Mosley)—I will not say I hope he is drying up in the way of correspondence, as has been the case with the hon. and gallant Member for Finchley (Colonel Newman)—but that we shall have no criticism from him in regard to this. This Clause is introduced to carry out an almost universal desire. The hon. Member for Colne Valley (Mr. Snowden), the hon. Member for Barrow-in-Furness (Mr. D. G. Somerville), and the hon. and gallant Member for Finchley, all put down Amendments relating to the Inhabited House Duty. I am very glad to say that the Chancellor of the Exchequer realised that the re-assessment would cause difficulties in this matter, and he met us very fairly. The proposal now is that houses below £39 in value shall be exempt. Houses between £30 and £60 will be charged 3d. in the £, and those between £60 and £90 will be charged 6d. Houses above £90 will be charged 9d. in the £. I should like to say, if I may—not in reply to the hon. Member for Harrow, I cannot do that on this Clause—in confirmation of what was said by the hon. and gallant Member for Finchley, that though, before these concessions were announced, I had an enormous mass of correspondence, occasionally of a somewhat violent character against the Government and myself, I have had none since that time, with the exception of one rather abusive telegram—I forget who it was from, and I am not quite sure whether or not it was anonymous. With that exception, I can confirm what has been said by the hon. and gallant Member for Finchley, that the concessions seem to have given great satisfaction.

Mr. HARRIS: I do not wish to seem ungrateful to the Financial Secretary for the very big concessions he has made; and I do not feel justified in the circumstances in asking him to make any further concessions, especially considering the difficult financial position of the country at the present time. It is only fair, however, that I should point out, especially for consideration next year, that this concession, though it is a very great one for
the rest of the country, is not such a large one for the Metropolitan area. In the Metropolitan area it has always been recognised that the assessments are very much higher, and practically no houses will be exempt in that area. On the new estates outside the Metropolitan area, which have been developed with the assistance of the Ministry of Health, there are 2,816 houses and flats, 2,250 of which are assessed at over £30 a year. Because these houses now become liable to Inhabited House Duty it has been found necessary to raise the rents from 1d. to 5d. per week, and it has caused very serious discontent, and a grievance—

Sir W. JOYNSON-HICKS: The hon. Member will understand that those houses would have been liable to pay Inhabited House Duty prior to this.

Mr. HARRIS: Yes, but the point is that under the lower assessments previously they were exempt. There is the increase in the cost of building and also on the assessments, and, therefore, houses that before the War would have been completely exempt now come within the limit. At any rate, that is what I am informed; I have a report from the Local Government Committee of the County Council to that effect. I have only been asked to put this at a very short notice, however, and I do not feel justified in pressing the point further, now. It is right that it should be pointed out to the House and to the Chancellor of the Exchequer that, owing to the increased assessments, London does not get full advantage of these concessions. I understand there has been recognition of the position that London is entitled to exemption for houses assessed at a higher figure than the rest of the country. Of course, the costs in London are very much higher, and, therefore, the values in London are much higher than the rest of the country. I quite appreciate that in the present financial position of the country, and after the great concessions which the Chancellor has made, it is not fair to press this point.

Sir PHILIP PILDITCH: My hon. Friend the Member for South-West Bethnal Green (Mr. Harris) seems to be under the impression that only in London have assessments gone up. On the contrary, surely, he will remember that it is really because assessments have gone up outside London that these concessions
have been made. It was from a sense of justice that the concessions which were given to those outside London were also made to London. I do not think my hon. Friend can go so far as to suggest that both outside and inside London—

Mr. HARRIS: I do not want to interrupt the hon. Gentleman, but I would point out that a portion of the working-class cottages and houses in the rest of the country are under £30, but that in London there are practically none under £30. Therefore, in London, there are no houses exempt from Inhabited House Duty.

Sir P. PILDITCH: I hardly think the hon. Member will suggest that there should be a differentiation in the rate of allowance between London and outside. If that be his argument, I do not think this is the proper opportunity of going into any differentiation in the scale of taxation.

5.0 P.M.

Mr. LORDEN: I cannot understand the hon. Gentleman the Member for South-West Bethnal Green (Mr. Harris). I have been astonished at the very wide concessions that the Chancellor of the Exchequer has been able to give in these matters. I think they are excellent, and I am surprised that anyone should grumble at them. I think that anyone who has anything to do with property is only too delighted to accept them and say nothing.

Mr. PRINGLE: I think the right hon. Gentleman and his hon. Friends on the other side have not quite appreciated the case my hon. Friend the Member for South-West Bethnal Green (Mr. Harris) is putting forward. He is putting forward only a general case and not in reference to this particular concession. A house of £20 in London and a house of £20 outside London are entirely different things. A house of £20 outside London is a much better house than one of £20 in London. If you take the exemptions in pre-War days, you will find that of the houses of £20 over 80 per cent. of these houses outside the metropolitan area were exempted, while only 23 per cent. were exempted in London. That shows that standard of £20 in London and the provinces was unjust in regard to London. What my hon. Friend was suggesting was that when a new scale is
being adopted, as it is being adopted by this Clause, some account should be taken of this difference, and while £30 may be an admirable limit for the rest of the country, it is not so for London. I think from the figures I have quoted I have made good that contention. Obviously, when you are levying a tax of this kind, which is based on the value of a house a man inhabits, you should endeavour to tax men relatively in the same way who are in the same position all over the country. The rent standard of £20, as it was formerly, and £30, as it will be if this Clause be passed, is not fair between all sections. My hon. Friend has been at some disadvantage in presenting the case. Had he had time he would have desired to propose an Amendment to give effect to this. The difference between London and the rest of the country has been recognised in other legislation. In the increase of Rent and Mortgage Interest Restriction Act, a different standard was taken for London and for the rest of the country. The figures are within the recollection of the House. For the purpose of restriction of rent it was recognised that the limits which were applicable to the rest of the country were not fairly applicable to London. If that is true in respect to restriction of rent, surely it is equally true in respect of the taxation of inhabited houses. While my hon. Friend is not pressing this point, I think it is extremely important that the Financial Secretary should bear it in mind, and I hope that between now and another Finance Bill he will have this matter before him and endeavour to see that justice is done as between taxpayers in London and taxpayers in other parts of the country.

Sir HERBERT NIELD: I congratulate the last speaker on that nimbleness of mind which enables him to take up any case at any moment. He thinks there is no distinction between London and suburban houses.

Mr. PRINGLE: May I point out that that would apply to the whole of the Metropolitan area.

Sir H. NIELD: When I speak of the suburbs, I mean outside the county of London. You must remember that people have to pay substantial sums to get backwards and forwards from their homes to their places of business. A man
who has to take a ticket from say, Hendon or Golders Green to get to and from his work has really to add that to his rent. Therefore, higher rentals in London are justified by reason of the absence of that liability to get backwards and forwards. You have to have a higher value in London because of the increased value of the houses, and unless you distinguish between the country districts and London you would be doing a great injustice to those persons who wanted to have the protection of rent restriction. You would have a level valuation throughout the whole country. Many men who ought to have had the benefits of these Acts in London would have been excluded. Therefore, you must remember that the man in London is on the spot and can walk backwards and forwards and probably does himself a great deal of good by walking backwards and forwards. For these reasons, I think there is no reason for a distinction between the different areas and I hope my hon. Friend will not make any concession.

Question, "That the Clause be read a Second time," put, and agreed to.

Clause read a Second time, and added to the Bill.

NEW CLAUSE.—(Exemption, from Income Tax for 1923–24 of funds of National Health Insurance Authorities and certain unemployment funds in the Irish Free State.)

Sub-sections (5) and (6) of Section thirty-nine of the Income Tax Act, 1918, (which give exemption from Income Tax in respect of income derived from the funds of approved societies and other authorities under the Acts relating to National Health Insurance), and Section thirty-three of the Finance Act, 1921 (which grants exemption from Income Tax for funds of special and supplementary schemes under the Unemployment Insurance Act, 1920), shall, notwithstanding the constitution of the Irish Free State, have effect so far as relates to Income Tax for the year 1923–24, as though the references therein to enactments relating to National Health Insurance and to the Unemployment Insurance Act, 1920, respectively, included references to the enactments in force in the Irish Free State relating to National Health Insurance and to Unemployment Insurance, respectively, and as though the reference in the said Sub-section (5) to the Irish Insurance Commissioners included a reference to the authority charged with the administration in the Irish Free State of the enactments
relating to National Health Insurance and to the body of trustees constituted for the purposes of the Government of Ireland (Adaptation of Health Insurance Acts) Order, 1922."—[Sir W. Joynson-Hicks.]

Brought up, and read the First time.

Sir W. JOYNSON-HICKS: I beg to move "That the Clause be read a Second time."
This new Clause will give exemption for one year only to certain funds belonging to the National Health Insurance of the Irish Free State. Under National Health Insurance, large funds were collected, a certain proportion of which belongs to the Irish Free State. These funds are now in course of division. Different securities will be allotted to Great Britain and different securities will be allotted by agreement to the Irish Free State. That has not been completed and cannot be completed for a few months, and in the meantime Income Tax is chargeable under the present law on the whole of these securities. I therefore propose this Clause to deal fairly by the Irish Free State and prevent Income Tax being charged on one year only during the process of the division of these funds. We have been in communication with the Irish Free State, and they have agreed to bring in a Clause in their Finance Bill making a reciprocal provision in case any securities belonging to us may be discovered in the Free State.

Sir F. BANBURY: Are there any securities belonging to us in the Irish Free State?

Sir W. JOYNSON-HICKS: I believe there are a few.

Sir J. BUTCHER: I wish to ask whether it is not a fact that certain Indian and Colonial securities standing in the Bank of Ireland are taxed by the Irish Free State? Will the Financial Secretary to the Treasury take care that, in any reciprocal arrangement, we make sure that these funds will not be taxed by the Irish Free State?

Sir W. JOYNSON-HICKS: Any funds in Ireland belonging to the approved societies are, by arrangement made with the Irish Free State, to be exempted.

Sir F. BANBURY: Will my right hon. Friend not consider that, if he has an opportunity of getting any money out of the Irish Free State, he had better take it?

Question, "That the Clause be read a Second time," put, and agreed to.

Clause read a Second time, and added to the Bill.

NEW CLAUSE.—(Provision as to relief from double taxation on profits from the business of shipping.)

"(1) If His Majesty in Council is pleased to declare—

(a) that any profits or gains arising from the business of shipping which are chargeable to British Income Tax are also chargeable to Income Tax payable under the law in force in any foreign State; and
(b) that arrangements, as specified in the declaration, have been made with the Government of that foreign State with a view to the granting of relief in cases where such profits and gains are chargeable both to British Income Tax and to the Income Tax payable in the foreign State;

then, unless and until the declaration is revoked by His Majesty in Council, the arrangements specified therein shall, so far as they relate to the relief to be granted from British Income Tax, have effect as if enacted in this Act, but only if and so long as the arrangements, so far as they relate to the relief to be granted from the Income Tax payable in the foreign State, have the effect of law in the foreign State.

(2) Any declaration made by His Majesty in Council under this Section shall be laid before the Commons House of Parliament as soon as may be after it is made, and, if an Address is presented to His Majesty by that House within twenty-one days on which that House has sat next after the declaration is laid before it praying that the declaration may be revoked, His Majesty in Council may revoke the declaration, and the arrangements specified in the declaration shall thereupon cease to have effect, but without prejudice to the validity of anything previously done thereunder or to the making of a new declaration.

(3) The obligation as to secrecy imposed by any enactment with regard to Income Tax shall not prevent the disclosure to any authorised officer of the foreign State mentioned in the declaration of such facts as may be necessary to enable relief to be duly given in accordance with the arrangements specified in the declaration.

(4) In this Section the expression 'business of shipping' means the business carried on by an owner of ships, and for the purposes of this definition the expression 'owner' includes any charterer to whom a ship is demised."—[Sir W. Joynson-Hicks.]

Brought up, and read the First time.

Sir W. JOYNSON-HICKS: I beg to move, "That the Clause be read a Second time."
This is quite a new Clause and one which I think I ought to explain to the House, because it is introducing a new principle in financial legislation. The House knows there has been considerable difficulty for many years on the question of double taxation between this country and foreign countries. They also know, I think, that the League of Nations has set up a Committee to consider this whole question of whether an arrangement cannot be arrived at between all the countries of the world to prevent double taxation. I think the Committee of the League of Nations must necessarily take some considerable time before they arrive at any decision, until mutual legislation has been achieved in all the countries of the world. We have had under very careful consideration the question of double taxation on shipping. Obviously, shipping is more severely hit than any other industry by double taxation. Ships, whether they be English or the ships of other nations, travel to all ports of the world and do business in almost every foreign country, and they have to make return for Income Tax on any profits they may earn, whether in South America, North America, or any other place. It is not only a question of the amount of double taxation they suffer from, but it is the enormous complexity of every kind of return which our shipping companies have to make all over the world.
The United States has had this matter in hand, and in 1921 they passed a law to exempt from Income Tax the shipping of any foreign country which was ready to grant equivalent exemption. That is the first olive branch that has been held out to us by any foreign country. The Chamber of Shipping of Great Britain very carefully considered this proposal, and then they came and saw His Majesty's Government to consider whether or not it would be possible for us to accept the olive branch and grant the same kind of exemption from Income Tax for American shipping as America is prepared to grant to British shipping. His Majesty's Government, and the Chancellor of the Exchequer in particular, very carefully considered this, and they have come to the conclusion that in the interests of the shipping trade of this country it is highly desirable to take every possible step we can to get rid of this very troublesome system of double taxation. I hope that if this
Clause be accepted by the House and it proves to be a success, it will be merely a forerunner of a larger scheme of legislation which would exempt all trades from double taxation throughout the world.
We are beginning with shipping, and we are to make this experiment. We propose to do it by taking powers to His Majesty in Council to make an Order in Council, after negotiations have taken place with any foreign country, exempting the shipping of that foreign country from paying Income Tax in this country. Obviously it is impossible to put a Clause in a Finance Bill making this matter conclusive the moment the Finance Bill is passed, because it depends upon negotiations with foreign countries. We are adopting the same course as we adopted in regard to the Irish Free State legislation; that is, after a Treaty is made, His Majesty, by Order in Council, may make it as binding as an Act of Parliament. I have provided in the terms of this Clause that the Order in Council shall be laid on the Table of this House within twenty-one days, so that it cannot be carried into law if the House objects. We are providing that the Executive cannot pass this into law until the House consents, but the House will recognise that we must have a treaty first with the United States, or with any other foreign country. I ask the House to let this Clause pass, partly because it is desired by the shipping community, partly because it will give a valuable fillip to the League of Nations, and partly because I think it will do real good to our shipping industry. I hope it will lead to dealing with this troublesome question of double taxation, not only between ourselves and the United States, but between all the countries of the world.

Mr. WILLIAM GRAHAM: The Financial Secretary, in introducing this new Clause on the Report stage, properly apologises for introducing a matter of such importance at this point in our proceedings. This new Clause differs from all other Clauses on the Report stage in that it raises a matter of first-class importance regarding our Income Tax system, and I hardly think that hon. Members will agree either to pass the Clause, or to support it afterwards, without very careful consideration. In regard to shipping, I should like to recall
the inquiry which was made under the auspices of a Committee presided over by Lord Colwyn. The proceedings took place in 1921, and the Report was issued in 1922. That Report turned on the trading of Governments, foreign and Dominion, and raised this particular problem of shipping. Hon. Members will recall that there are classes of ships known as public ships, which enjoy sovereign immunity. During the War there were in existence the United States Shipping Board, in a quasi-sovereign capacity, which raised very difficult problems as to how the trading of that great organisation should be taxed, and how far it had ceased to be in, if it ever was in, a sovereign capacity.
The recommendation of the Committee was that everything in the nature of trade by foreign and Dominion Governments should be taxed. That principle was quite clearly laid down. Up to the present time we have had no public reference to that report on the part of the Government, until the matter has been raised indirectly by the New Clause which the Financial Secretary now proposes. I take it that the whole problem of public ships and the trading of these vessels under Government auspices during the War has been practically solved by the disappearance of war-time conditions, on the principle embodied in the Report of the Committee. The second stage in the problem was reached in the Report of the Royal Commission on Income Tax in 1919. The Royal Commission drew a very sharp distinction between the treatment of our Dominions and Colonies on the one side in the matter of double taxation, and the treatment of foreign countries on the other. Although it is not strictly relevant, I should like to mention what was done in regard to the Dominions, in order to put the question regarding foreign government, because the two problems are bound up together.
The Royal Commission said as regards double Income Tax within the Empire—and this was a subject of anxious inquiry by a Sub-Committee of the Royal Commission—that there should be relief equivalent to the lower of the two rates in force, but they also said that any relief that was given should not exceed one-half of the rate of Income Tax imposed in Great Britain. They also urged, beyond that, that if anything was
required in order to make up the relief on the concession on the first point that that should be forthcoming from the Dominion Governments. I mention that for this reason, that when we came to consider the position of the foreign Governments in the matter of double taxation we came to the conclusion that at this stage it was quite impossible to make any recommendations. A clear distinction was drawn between the Empire and foreign Governments. There were within the Empire certain common interests in finance, all of which were provided from taxation generally within the Empire, but as between this country and foreign Governments there was no such community of interest, and there was no such community in taxation or revenue. We recommended that it was impossible to make any statement regarding the foreign Governments, but we did say—and I take it that it is broadly on this that the Financial Secretary is founding his case—that if it was possible to arrive at arrangements with foreign Governments in this matter this might be the basis, under the auspices of the League of Nations, of a solution of this undoubtedly grave problem.
I take it that nobody wants to impose double taxation upon the same trade, but we must be perfectly sure that we in Great Britain are getting a fair bargain, that there is substantial reciprocity, and that we are not losing on the transaction. The difficulty about the proposal which the Financial Secretary is making is that, in the first place, it is made very late, almost at the last stage of the Finance Bill, and we have not proper means of estimating its advantages or disadvantages. In the second place, it violates the recommendation of the Royal Commission on this point as regards foreign countries. The recommendation of the Royal Commission in regard to these arrangements applied to trade as a whole, and not merely to one section of trade as represented by shipping. I agree with the Financial Secretary that we find perhaps a supreme example of this difficulty in shipping, because that is a thing which links us to foreign countries and foreign countries to us. The Royal Commission had in mind a general scheme which would apply to trade as a whole between foreign countries and this country, and they did not suggest an
isolated arrangement in regard to shipping or any other industry on the lines which the right hon. Gentleman now proposes.
What will be the inevitable result of this proposal? Let us suppose that we get an arrangement as regards shipping with the United States of America. Is it possible to separate that relief in taxation from the taxation of other classes of trade between the two countries which will continue presumably on the double basis? It is perfectly impossible to adopt a special or specific arrangement of this kind in regard to one trade without doing damage or disadvantage or harm or, at least, inflicting hardship on other classes of industry and commerce proceeding between the United States of America and ourselves. The Financial Secretary, no doubt, appreciates the difficulties of the case, because he has hedged the proposal with all kinds of qualifications. It is to come to the House for ultimate ratification, on the 21 days' basis. We all know perfectly well what that protection means in the House of Commons. It means discussion, after 11 o'clock at night, upon a highly technical problem, when it is very difficult to keep a House, and when it is practically impossible to measure the gain or loss which this country is incurring on the transaction. I do not oppose the proposal on the question of principle, but I do most seriously oppose it on the question of method, and I hope, before the Debate closes, that the Financial Secretary will be able to give us a much more complete statement in regard to the points I have raised than we have so far received.

Mr. HANNON: I strongly support the Financial Secretary in introducing this New Clause. Although the points raised by my hon. Friend who has just sat down have very considerable substance, it is a fact that the introduction of this legislation was very fully discussed in the House last year, and on both sides there was a general feeling that something should be done to give relief in respect of double taxation to the great shipping industry of this country. It was exceedingly difficult to take any step forward until the United States had passed its law in 1921. Since then those of us who were interested in safeguarding the interests of our shipping, which is the greatest of our national
enterprises, felt that it was necessary to press the Government to take some step on the basis of the Debate last year following up what the United States had done. The reference made by the hon. Member for Central Edinburgh (Mr. Graham) about bringing our Dominions into consideration on this question in the present Finance Bill will not, I trust, have any influence with the Financial Secretary. Any concession we can make at this moment to the shipping industry of this country will be a godsend, not merely to the shipping industry itself but to everything that attaches to the shipping industry. This measure of relief is being brought forward at a moment when it is of the greatest interest and service to the shipping industry, and while I agree that it may be ultimately necessary to carry out the recommendations of the Colwyn Committee, or the collateral recommendations of the Commission on Income Tax, we shall make a beginning in the direction which will be of great benefit to this country if the proposed concession is now made. I hope that my hon. Friend, who is so greatly interested in our industries, and whose splendid work on the Income Tax Commission has evoked the admiration of this House will not stand in the way of this concession to the shipping industry.

Mr. HILTON YOUNG: It is within the memory of the House that this subject was reserved from consideration, as it were, by the right hon. Member for Hillhead (Sir R. Horne) last year, with the idea, to put it frankly, of giving us time to watch the policy of the United States in the matter. I am glad to register on this occasion the feeling of relief that I find that it has been possible to come to this decision and to move forward in this matter. I welcome the Clause. It is with very great diffidence that I find myself in opposition to the hon. Member for Central Edinburgh, because his views upon financial matters and upon questions of Income Tax are always so clearly expressed, and almost always so sound. I found a great difficulty last year in entirely appreciating the course of his argument, and my hopes that that difficulty would be removed this year have not been quite fulfilled. He argues against this Clause partly on the ground of the recommendations of the Colwyn
Committee. Surely there is some misapprehension. The Clauses of the Report of that Committee are concerned with the important matter of public trading by Governments. Is not that irrelevant? It appears to me that it is. As I understand it, all the questions dealt with by that Committee were the questions of differentiating between publicly owned concerns and privately owned concerns.

Mr. W. GRAHAM: That is true. The difficulty arose in this way, that the Governments had really entered into the position of traders during the War. It was that trouble which we were trying to clear up. They were exactly in the position, for all practical purposes, of private trading concerns.

Mr. YOUNG: Those questions are quite untouched by the machinery of this Clause. There will be ample scope within the very wide permissive powers given by this Clause to carry into effect any differentiation which is recommended by the Colwyn Committee. He argues further—and, of course, it will have much weight with the House—that it is of great importance that careful watch should be kept to secure fair treatment to British interest's under the reciprocal Clauses in this arrangement. It appears to me that the true answer to that apprehension is also in the permissive character of these Clauses. I should be strongly opposed to tying down his Majesty's Treasury to a hard-and-fast line on such an arrangement as this. Supposing a foreign country had an Income Tax which, to put it rather extremely, was nothing but a bogus tax and desired to secure exemption of shipping in respect of the bogus tax, by waiving the bogus tax against our real tax, that would require special action, and I have no doubt that the advisers of the Government would be fully alive to it.
I think, on the whole, I have really less sympathy with my hon. Friend's argument, if I follow it further. He seems to be apprehensive of our moving in this matter step by step. This is a very wide and difficult, technical matter, the matter of double Income Tax, and if we can see one clear step, for goodness' sake, let us take it—one clear step that will not prejudice further steps. If it would prejudice further steps, I should be against taking it, but indeed I do not think so. The shipping industry is very
sharply marked off from all others. It stands on a very special footing in this respect. Transport industries are about the only industries which are necessarily international, and that appears to me to mark them off from others and to make them suitable for special treatment in this matter. The magnitude of the British interests I need not dwell upon. The whole topic is gaining fresh importance every day, because of the growing importance of Income Tax in foreign countries. Before the War our own and a few other countries' Income Taxes were the only substantial Income Tax burdens, but war burdens made Income Tax a matter of great fiscal moment in all countries. I am convinced that a time will come when it will be necessary, in the interests of industry as a whole, to secure some general working solution amongst all civilised nations for the avoidance of double Income Tax in all international industries, and I certainly welcome a start being made upon it in what I believe is a practical manner.

Sir J. BUTCHER: I cordially welcome this Clause as introducing, for the first time, so far as I know, an attempt to avoid double Income Tax by this country and a foreign country on trade. All Income Tax is more or less a burden upon trade, but double Income Tax may be very often sufficient to kill a trade, and, therefore, I welcome this attempt towards avoiding the undoubted evils of this tax. It appears to me that this Clause is somewhat nebulous in character, and I should like to see a little more definition in it. The important thing for us, when we are making an arrangement, and when there are shipping profits liable to Income Tax in this country and also, let us say, by way of illustration, in the United States, is: How are we to decide what profits are subject to Income Tax in the United States and what profits are subject to Income Tax here? That is the first, and a very important, question to decide, and perhaps my right hon. Friend the Financial Secretary to the Treasury will be able to tell us on what sort of principle he is going. In some cases it is possible to say that profits were derived in the States, and they would naturally be subject to Income Tax there, and the same with profits derived here, but, in the case of shipping, I think it would be very difficult.

Sir W. JOYNSON-HICKS: They are already assessed both here and in the United States.

Sir J. BUTCHER: Yes, but you are going to say that all those profits already subject to Income Tax in this country will be relieved to a certain extent, for this reason, that the profits you tax in this country will also be taxed in the United States, and, therefore, when you have shipping profits taxed in both countries, you are to make an arrangement by which there shall be some relief from the double tax. I want to know on what principle you are going to frame that relief. Are you going to say that half the profits, or some other proportion, earned by the shipping trade which are subject now to Income Tax in both countries is to be taxed in England and the rest in the United States? When we have decided what part of the profit is to be subject to British Income Tax and what part to the United States Income Tax, what relief are you going to give? We desire, of course, that this relief should be given in the interests of British trade, and so that the British Exchequer shall not lose too much, but I think we should have a statement from my right hon. Friend as to the general principles on which he will make these arrangements with the United States and the other foreign countries concerned, so that the House may fully realise that our interests as regards taxation will be protected.

Sir JOHN SIMON: The subject raised by this Clause is a very important subject, and I agree with my hon. and learned Friend the Member for York (Sir J. Butcher) that it is also a very difficult subject. Those of us who have had occasion to try to understand how the Income Tax really works in connection with cases of this sort will be the first to admit what a very difficult subject it is, and I do not rise for the purpose of opposing the Clause, but I think a little more discussion of the subject might be very useful, especially as the matter has been introduced only on the Report stage of the Finance Bill. May I first put to the Financial Secretary to the Treasury what may seem a minor point, though I think anybody who knows the way in which the shipping trade works will desire to be entirely clear about it? I want to put to him a point on Subsection (4) of
this Clause, where he defines the business of shipping as meaning
the business carried on by an owner of ships, and for the purposes of this definition the expression 'owner' includes any charterer to whom a ship is demised.
The cases of that sort are very few indeed. There are two ways in which the owner of a ship allows it to be used by a charterer. In far the greater number of cases there is no demise of the ship whatever. There is a charter party entered into, and as a result of that agreement, whether it be for a period of time or whether it be for a number of voyages, the charterer of the ship can control what work the ship does, between what ports it sails, and what cargo it takes, according to the terms of the charter, but the ship is never demised to the charterer. The master of the ship and the crew of the ship are provided by the owner and continue to be the owners' servants, and he pays for them, and the expenses of working the ship are all expenses which, in the first instance, are met by the owner, and though it is true the owner is paid hire by the charterer, the charterer is not the person to whom the ship is demised.
There is a much less common case, in which the owner of a ship actually demises it, or lets it, like a man lets a house or any other piece of property, to a charterer, and in that case the charterer has the full possession of the ship, and uses it as if it were his own, and in that event the charterer in ordinary business is the person who appoints the master and crew and is responsible for all expenses. I think, though I speak merely from such knowledge as comes from having had to advise about these matters, that the shipping community will want to know whether, when you talk about the "business of shipping," you really mean to confine it to such business as is carried on by persons who are the owners of a ship, together with the comparatively rare cases in which the owner of a ship actually demises it to somebody else. If that be the case, you are excluding the great mass of the charterer's business altogether. It may be that you intend to do so. I point it out, because I think it would be lamentable if in the future we fell under rebuke from the Law Courts, where they do not
always know what our difficulties are in the way of legislation, and there was really any misunderstanding about it.
The second thing I would like to say is this. I do not know whether the hon. and learned Member for York has come personally across this shipping case in the practice of his own profession. I confess I have not very often myself, but the kind of case with which this Clause is meant to deal is the kind of case which it is a matter for the House of Commons to deal with, and to deal with in a broad way. The truth is that, now that Income Tax is so high, unless we can devise some arrangement which would prevent the burden of double Income Tax falling on companies carrying on business here, there is a common temptation for such enterprises to take themselves off and establish themselves somewhere else.

Mr. A. M. SAMUEL: British companies.

Sir J. SIMON: Yes. It is a most serious problem for anybody interested in the finances of the country. In my own experience, and in the experience of many lawyers I am sure, one has come across cases where one is consulted for the specific purpose: What must I do in order to change either the constitution or the way in which I am directing and managing this company in order that I may avoid what I am threatened with now, namely, the imposition of Income Tax by the British authorities upon the whole of my balance of profits and gains? And there are well-known cases within recent year in which the most elaborate arrangement has been made, in which people have moved themselves elsewhere, while still trying to carry on a portion of their business here in order to avoid the meshes of the Income Tax.

Mr. A. M. SAMUEL: The right hon. Gentleman must not carry his argument too far. I quite agree with him, but he must remember that if he carries it too far he brings mines abroad into that arrangement.

Sir J. SIMON: I do not quite know to what the hon. Gentleman refers, but I am talking about a very well-understood difficulty which for years has faced both the Treasury and those who have been con-
cerned to consider how the Income Tax works. My recollection, though I speak subject to correction, is that, so far as shipping was concerned, we did not, as a matter of fact, attempt to impose our own Income Tax upon the profits of foreign shipping that happened to visit our ports until about the year 1916. My broad point is this: It is most important that we should in this matter protect the British revenue if we can do so, and at the same time not encourage those who are disposed to make new arrangements to avoid the British revenue by moving elsewhere. The House has always to remember that, before the British Income Tax is imposed upon the profits or gains of a company, the question that has to be decided is not whether the company is registered under our own Companies Acts. That is not the relevant question. The relevant question is not whether the company is registered, but does the company really conduct its business, or is the head and seat of its business, here in this island? If so, the whole of its balance of profits and gains is liable to British Income Tax.
It is obviously in the interest of this country that we should have arrangements which will encourage people to carry on their business here. It makes our country the centre of a very important trade which otherwise it might not be to the same extent. It tends to provide employment and is an advantage to the revenue and to us all. Therefore it seems to me that the principle which is in this Clause is a principle which it is very desirable to apply, if that can be done, but I must, say I wish the Clause had been subjected to discussion in Committee and that we had more time to consider it. It is a very difficult subject and one is not content to accept at fist sight, a provision under which the whole thing is to be controlled by an Order in Council. That is a form of exemption from taxation by reference which a good many people feel is not the best, and looking at this Clause quite casually there are some considerable problems to be considered in it. May I put this point to the right hon. Gentleman? In the first Sub-section, having provided in the case of an Order in Council declaring that arrangements have been made with the government of the foreign state, for
the granting of relief, I notice the Clause proceeds:
then unless and until the declaration is revoked by His Majesty in Council the arrangements specified therein shall so far as they relate to the relief to be granted from British Income Tax have effect as if enacted in this Act—
Then it proceeds further, and I am not at the moment quite clear why—
—"but only if and so long as the arrangements, so far as they relate to the relief to be granted from the Income Tax payable in the foreign State, have the effect of law in the foreign State.
Surely it must be for His Majesty in Council, by revoking the declaration, to decide when that point has been reached. The right hon. Gentleman cannot mean that there is going to be litigation in the English Courts between the Revenue and the shipping companies, on the issue, "Are these arrangements, arrangements which still have the effect of law in the foreign State?" That cannot be a matter for an English Court to determine. That must all be governed by the judgment of the Government in securing a revocation of the Order in Council. I am not picking holes for the mere sake of picking holes, but it seems to me that this Clause is worthy of a longer consideration than we can give it to-day. The main point I rose to make is that it is clearly in the interests of good democratic government that we should, so far as we can, secure that people who carry on their business in our country are not penalised for so doing by having to pay a double tax. It is in the interests of good government that we should put before them an inducement not to go elsewhere. For these reasons I support the principle of the Clause. I confess I am much puzzled by the definition of "business of shipping" at the end, and its application in relation to all sorts of shipping companies, whose ships are held under charter, and I think there are other details which deserve a little more discussion.

Mr. GOULD: I entirely agree with what has been said, but I think we should be very careful with regard to Sub-section (4), containing the definition applying to an owner or charterer. It is customary in the American shipping trade to charter boats on what we call the bare-bottom basis, whereby the ship is taken as it stands, without any crew or anything at all, but a hiring figure is fixed for the vessel without equipment
or crew. The vast majority of time-charter business is done on a basis whereby the crew is taken over, stores are provided and a rate is fixed to cover that expenditure. Most of these time charterers use the chartered vessels to take the place of other vessels which they cannot put into the service. If the Clause is left as it stands, the time charterer, employing another man's vessel in his own trade is going to be exempted from the provisions of the Amendment and the right hon. Gentleman should be very careful in seeing that the time charterer, as distinct from the voyage charterer, gets the benefit of the Amendment.

Sir W. JOYNSON-HICKS: I am quite prepared to move the omission of the last six words, "to whom a ship is demised," and then the Clause will include any charterer. I think that should meet the objections which have been raised.

Mr. ALEXANDER SHAW: As I have been specially interested in this subject, perhaps the House will forgive me if I refer to the general problem which this Clause is designed to solve. The problem arose in this way. In the year 1916 this country tightened up taxation upon agents generally and it was found that there was brought into the net of the tax gatherer here the profits of companies or individuals owning any ship which touched at a British port. In theory we had power to do so before but, in effect, we only began to tax foreign shipping then and it was not very long before the foreigners began to retaliate. Almost immediately, Norway armed herself with powers to impose Income Tax upon the profits of British shipping. The United States acted very soon and levied a tax upon British shipping which has been, and continues to be, a tremendous burden, not only because of its severe fiscal character, but because of the endless complications imposed on those who conduct the business of British shipping in the United States. Only a few weeks ago a gentleman, whose name I will not give, but who conducts in the United States the management of one of the greatest lines in the world—with which I have no connection whatever—told me in the hearing of the Prime Minister, while on a deputation to the right hon. Gentleman on this subject, that the complications of the American tax system were so great that he, the manager of this great steam-
ship line, spent more time in complying with the requirements of American assessments and the complications of American tax law than he was able to devote to running his fleet of ships.
Not only with regard to the United States, but with regard to other countries also, there are, springing up throughout the world, the symptoms of a tax war, and the result of that will be, as the House must appreciate, that as British shipping offers by far the greatest target, compared with any other shipping in the world, it will be much the worst hit. At every port to which British shipping goes in foreign lands, there will be a tax gatherer awaiting it. If it goes to Norway, Spain, Portugal, France, Italy or any of our great Dominions, it will be faced with the appalling prospect of complying with the exceedingly intricate and often completely conflicting codes of taxation which obtain in those various countries. That is not the end of it. Unfortunately, certain countries, among them some of our own great Dominions, have tied themselves down to a system of Income Tax upon shipping which ignores altogether the question of whether any profit has been made or not. In the great Commonwealth of Australia, for instance, to-day, although ships are being run there at a loss, yet 10 per cent. of all the gross outward freights is considered to be profit and Income Tax has to be paid on that amount.
This arbitrary form of assessment is becoming more and more common throughout the world and it is about to apply in India and, I believe, elsewhere. I think people are beginning to realise that this system is a potential cause of international friction. Not only because of the loss to this country, not only because of the international friction involved, but from the point of view of the British Treasury, there is a good deal to be said for this Amendment. Under the perfectly equitable provisions of the British Income Tax law, all these deductions from the earnings of ships made by way of taxation at different ports throughout the world, are counted part of the expense of carrying on the business, and the result is they have to be allowed for in the assessment of British Income Tax, as expenses incurred in carrying on the business. Under the present system, the result of the conces-
sion made by this Clause will not be a loss to the Treasury but an absolute gain. From every point of view the Clause should command support. It was thoroughly discussed last year and a number of speeches were made in support of it and the present Solicitor-General, next whom I had then the honour to be seated, made a most eloquent speech on the spur of the moment, having been convinced by the arguments of my hon. Friend the Member for Ilford (Mr. Wise). The matter has not escaped public attention since, and there have been not only resolutions by international conferences, but resolutions by the chambers of commerce in this country and by the Chamber of Shipping and other shipping organisations. Nor indeed should this Clause fail to find a large measure of support from the Labour Benches. I shall be very much surprised if the hon. Member for Central Edinburgh (Mr. W. Graham) voiced the opinions of his party, when he tried with that dexterity which he always displays to pour cold water upon the provision of this Clause. I hope we may have some announcement from the Labour benches in favour of a proposal which is not only a good business proposition, but is one which will immediately help our relations with America and in the long run prevent international friction.

6.0 P.M.

Mr. SEXTON: It is not often I find myself in agreement with the Treasury Bench, but on this occasion I heartily agree with every word in the proposed Clause though I do so purely from what may be regarded as selfish motives. From the point of view of those whom I represent, anything which relieves the shipping industry or which lifts any burden from the shipping industry, gives us at least a better chance of seeking for improved conditions or better wages. It is not always the case that these burdens upon the industry really exist in substance and in fact, but any concession of this kind strengthens our hands and gives us a better argument when we go to the industry to ask for more, while it removes at least one of the arguments usually put up against us as to the calls upon the industry in other respects. The less the burden on the shipping industry the better the chance we have. In a
commercial sense, and I speak now in a commercial sense, Britain may be said to rule the waves, though there is very serious competition from the United States. But, taken as a whole, our ships cover all the seas and nearly every port in the civilised world. Therefore it is important to reduce the burden on our shipping as much as possible. The removal of barriers of any kind of an international character ought to commend itself to all of us. This Clause is a step in the right direction in the removal of international barriers.

Mr. WISE: This Clause was fully discussed in the Budget of last year, and I always thought that the Chancellor of the Exchequer of 1922 was sympathetic towards it. I think that the main thing which we have to consider, and possibly that is why it is introduced in Council, is that the offer might be withdrawn by the United States of America. If the offer was withdrawn by the United States of America it would be very serious for our shipping, which is one of our most important industries, without which we cannot live. I consider that with regard to double taxation this Clause requires support. I understood from the Financial Secretary to the Treasury that he was going to set up a Committee with regard to this double Income Tax.

Sir W. JOYNSON-HICKS: indicated dissent.

Mr. WISE: Then I misunderstood him, but I would welcome a Committee if it was set up, because double Income Tax is one of the most difficult and complex problems which we have to consider in future; but we must realise that a burden of increased taxation in debtor countries is thrown upon the creditor country, and if one considers those problems and also if Members study the report issued recently by the Committee of the League of Nations on Double Taxation, I do think that the Financial Secretary to the Treasury will possibly consider setting up a Committee to go into this fully. I, anyhow, welcome this Clause which supports our shipping which is so necessary for this country.

Sir W. JOYNSON-HICKS: There are one or two points to which I might refer. In reply to the hon. Member for Central
Edinburgh (Mr. W. Graham), I would like to say that the report of the Colwyn Committee has not been published, and, therefore, he will forgive me if I do not enter into a discussion with him upon the remarks which he made concerning the report of that Committee. This is a purely permissive Clause. The question of double Income Tax is a matter of vital importance, and we want to remedy it wherever we can. As to setting up a Committee, it may be that a different Chancellor of the Exchequer may do so, but, as the hon. Member for Ilford (Mr. Wise) is aware, I can only deal with matters that come before me, and though I apologise for bringing this forward on the Report stage, yet I bring it forward as it is so urgent, having regard to the offer of the United States Government in 1921, which was made after the report of the Royal Commission, that we should lose no time in bringing this before the House with a view to giving the Government power at least to negotiate with the United States Government.
My hon. and learned Friend the Member for York (Sir J. Butcher) asked me how we were to allocate the amount of income which was to be attributed either to the United States portion or to the British portion. The answer is that that is done already. My right hon. and learned Friend the Member for Spen Valley (Sir J. Simon) is right in saying that the question of the site of the control of the shipping company is the vital one from the point of view of Income Tax. That we intend to preserve. There is no question of any alteration of the law as regards that. The calculation referred to by the hon. and learned Member for York is already made, though it may be difficult to make. The British shipping company is taxed in America, Holland, or anywhere else where the shipping company do business, on the estimated amount of profits earned in that country by the shipping of that particular British company, and these taxes are imposed by the American, Brazilian, or any other Government, and the company is entitled to deduct the amount of such taxation which it pays from the profits allocated for the purpose of Income Tax in this country. As the hon. Member for Ayr (Mr. A. Shaw) said, that is why the Treasury would gain some benefit, because, if the Income Tax on the por-
tion of the profits made in America is exempt from American taxation, the amount of that taxation can then be brought in to rank for Income Tax in this country. Therefore, though we should be letting off the profits of American ships in this country, we should gain corresponding benefit by not having to give an allowance for the Income Tax imposed in America on British shipping.

Mr. WALLHEAD: What happens in the case of a ship of a British company which changes its flag from this country to America to evade British taxation?

Sir W. JOYNSON-HICKS: It is entirely a question of where the control of the company exists. If the head centre of the company is British it is liable to British Income Tax. Then there is one other point of importance which was raised by the right hon. and learned Member for Spen Valley in regard to the terms of the new Clause relating to the meaning of "business of shipping." The definition which we have taken is taken entirely from the definition of "business of shipping" in the Finance Act, 1917, Section 22, Sub-section (23), relating to the Excess Profits Duty on the business of shipping. I think that it would be better to omit the last six words of the Clause, "to whom a ship is demised," so that the Clause would include any charterer of a ship. This point was also raised by the hon. Member for Cardiff (Mr. Gould). This alteration will make the Clause wider, and I think that it also makes it nearly in accordance with the provisions of the American Act which is
the income of a non-resident alien or foreign corporation which consists exclusively of earnings derived from the operation of the ship.
The Clause is a permissive one, but it will allow us to get on without waiting for another year, and any arrangement made would be subject to the approval of this House. I have not had time to consult my legal advisers, but it is desirable to get some Clause passed in this Finance Bill, and this is the last occasion on which to do it. It is of great importance, not merely from the point of view of shipping, but from the point of view of having the idea of getting rid of double taxation put upon the Statute Book. I think that the right hon. and learned Gentleman the Member for Spen Valley would be satisfied
that it would take some months, at all events, to get a treaty made with the United States of America, and then it would have to come to this House for approval, and perhaps the right hon. and learned Gentleman will consult me as to the precise words, which, if necessary, could be altered at the earliest possible opportunity.

Question, "That the Clause be read a Second time," put, and agreed to.

Clause read a Second time.

Amendment made: In Sub-section (4), leave out the words "to whom a ship is demised."—[W. Joynson-Hicks.]

Clause, as amended, added to the Bill.

NEW CLAUSE.—(Exemption from Entertainments Duty.)

Entertainments Duty within the meaning of Section one of the Finance (New Duties) Act, 1916, as amended by other enactments, shall not be charged in respect of payments for admission to the British Empire Exhibition to be held in or near London in the year nineteen hundred and twenty-four.—[Sir W.Joynson-Hicks.]

Brought up, and read the First time.

Sir W. JOYNSON-HICKS: I beg to move, "That the Clause be read a Second time."
This is the last new Clause which I move, and it is one which I trust will be accepted by all parties in this House. It is one which I am particularly pleased to have the opportunity of moving. After the concessions which we have made to-day in regard to trade exhibitions, I think that it would ill become us to demand the Entertainments Duty from those visitors from overseas, or from our own country, who visit the great Empire Exhibition which will take place next year. A portion of this exhibtiion will consist of a great trade exhibition, but, as the House knows, there is an amusement section, and there is also a stadium in which various contests of skill and otherwise are expected to take place. While I am going to ask the House not to impose the Entertainment Duty on the entrance fees to the exhibition itself, the duty will, of course, be charged on the entertainment portion. Anyone who has to pay for a different form of entertainment, or amusement, or who pays for seats in the stadium, where there may be athletic contests, or pays for anything
of that kind which would be purely in the nature of an entertainment, will have to pay the duty, but the Chancellor of the Exchequer thought, and I think that the House will agree, that, after the concessions which we have made this afternoon, it is only right that our fellow countrymen who come from the great Dominions to take part in the great exhibition next year should not go away feeling that Great Britain had imposed on them an Entertainments Duty on what would be an Imperial exhibition. On the other hand, if they go in for what is purely an entertainment inside the exhibition, they should be charged the Entertainments Duty. That being so, I move this Clause, not merely as an act of justice, which I think it is, but also as an extension of welcome to the vast number of Dominion visitors who will be coming next year to this great exhibition.

Sir J. SIMON: I think we all agree with what the right hon. Gentleman the Financial Secretary of the Treasury has said as to a desire to give a warm welcome to our visitors. Everybody desires to do that, but really, was not the right hon. Gentleman beating the big drum somewhat when he talked in the way he did? Surely a welcome to visitors from the Dominions is not to be expressed by saying that they need not pay Entertainments Duty, for if one is concerned to go to a cheaper part of the exhibition—though I do not know exactly what the tax will be—you may save 2d. or 3d., and that is the way we are going to make a happy Empire! We are going to make our friends from across the seas like us by giving them 3d. in the 1s.! It is a most ridiculous proposition. We all desire to give our visitors a welcome, but this solemn moving of a New Clause to allow one particular enterprise relief from the Entertainments Duty is a singularly strange way of going about it. We have had Debates on the Committee stage which have shown that the Entertainments Duty pressed very hardly upon very poor people. If the right hon. Gentleman had had some proposal, specially-devised for a special occasion, some really well thought out proposal which was going to reform the operation of the tax, there would have been a great deal to be said for it. But this particular proposal is a bit of flap-doodle.

Mr. PRINGLE: I trust that this extraordinary concession will not receive the assent of the House. We have seen and heard a great deal about this British Empire Exhibition, and after all we have seen and heard I think it is obvious that this concession is not devised in the interests of the Dominions at all, or of visitors from the Dominions, but is devised in the interests of this extraordinary undertaking itself. A great many of the people of the Dominions, it is true, will be visiting the Exhibition, but they will be a very small number relatively to those who do not come from the Dominions. Apparently, the bonds of Empire are to be tightened, and the affection of our Colonies are to be won, by giving them 2d. in the 1s. when they enter the Exhibition. Of the millions who will go to Wembley it may be taken that a very small percentage will be from the Dominions. Really you are going to relieve people who go to Wembley for amusements of various kinds into which it is not necessary for me to go into detail. We know the Empire Exhibition is in deep water, but we are going to give £14,000 to its secretary for reasons which have not been disclosed to the House

An HON. MEMBER: "The ex-secretary."

Sir J. REMNANT: The general manager!

Mr. PRINGLE: The general manager. Possibly this concession is intended to make up for the £14,000 which the Exhibition is going to sacrifice. It probably does not amount to that. You therefore save the risk of the guarantors being called upon for the £14,000. Money sacrificed by incompetence in appointing a secretary who, although perfectly competent, has been got rid of. I hold that this proposal is a bad one, and obviously the right hon. Gentleman did not really believe the sentiments he was putting forward. I know he believed the sentiments when he talked on the question of Imperial Preference, and that he believed it would go a great deal further; but when he introduces the same kind of sentiment in favour of this trumpery proposal, then it is really too much even for his most ardent supporters to accept. We have seen a great many strange things done. There was the fat lady that we heard of at the agricultural shows, because of
which the Agricultural Society has been barred from getting relief from the Entertainments Duty. We have here, however, a proposal that is in every way ridiculous and absurd at the present time, in relieving this extraordinary exhibition. I hope that a proposal so supported, a proposal with nothing to recommend it, but which simply means a present given to this particular undertaking, will be abandoned, and that the suggestion that this is going to be a concession in favour of the Dominions will be treated with the contempt which it deserves.

Mr. WALLHEAD: I desire to support what has already fallen from the hon. Member for Penistone (Mr. Pringle) and the right hon. and learned Gentleman the Member for Colne Valley (Sir J. Simon). In respect to the Imperial Exhibition I do not wish to be called ungracious or to adopt an attitude that would be considered in any way ungracious by our relatives and friends overseas. But when pleas have been made for the relief of taxation of our own people here, and declined, it does seem ridiculous that this corporation should be allowed to escape taxation. I agree with the hon. Member for Penistone in respect of the gentleman he named, the winter of whose discontent has recently been made glorious summer in the forms of Treasury notes. I agree that he is probably at the bottom of this suggested concession. I cannot in the least see why the Exhibition should afford to compensate a gentleman to the extent of £14,000—a matter we have discussed and asked questions about—I do not see why that entertainment should be allowed to escape its fair share of taxation. I agree with those who have spoken in opposition to the proposal that it is not worth while, and ought not to be considered by the House; and I hope that the House will see that if the smaller entertainments for children under 14 years of age are to receive no relief, we should not relieve gentlemen who go to the Imperial Exhibition, most of whom will be fairly well able to pay their way. We need not relieve them of the Entertainments Duty while insisting on keeping the tax at the figure it is, a figure which weighs heavily upon the juvenile section of the population.

Sir ALFRED BUTT: The Chancellor of the Exchequer and my right hon. Friend
the Financial Secretary, in reply to questions from all quarters of the House and speeches urging a reduction of the Entertainments Duty—[HON. MEMBERS: "Speak up!"]—refused it on the grounds that the Treasury could not afford to make the concession. Here the right hon. Gentleman is asking the House to make a very large concession to the British Empire Exhibition. The duty bears hardly on a good many working people in this country in respect of many, many entertainments, and here the proposal is to subsidise a very large number of affluent people in respect to an exhibition which, as my hon. Friend knows, is likely to produce a very large amount of money. I have had the opportunity of criticising the management of the British Empire Exhibition, and the right hon. Gentleman knows that a very lengthy inquiry was undertaken. At that time figures were placed before him showing that it was expected that at least 30,000,000 or 40,000,000 would pay for admission to the British Empire Exhibition. The Entertainments Duty, on that admisson, money would probably come to something like a quarter of a million of money. I do suggest to my right hon. Friend that if he has any concession to make that he ought to give it to the permanent industry of this country rather than to this problematical adventure at Wembley. And I say it on these grounds: that I do not think the Exhibition is going to be largely patronised by our friends from the Dominions. Even if so, I feel sure they would rather see the relief given to a permanent industry of this country than this adventure encouraged where, after all, it is not a question of people who are proposed to be out of pocket, but a large number of wealthy people who have guaranteed the expenses. They can afford to make a loss far better than the people of this country.

Captain W. BENN: May I ask the Financial Secretary whether he has any estimate of what loss to the Revenue there will be from the remission of this duty? Can he give us any idea at all of what he is losing by this? Secondly, is there any precedent at all in the fiscal legislation of this country for remitting to one particular person or enterprise their portion of a tax? The thing is entirely unheard of, that we should pass a Clause in the Finance Bill which says that So-and-so or such a corporation shall not
pay a tax. I have never seen anything of the kind in any Finance Bill. I do not believe there is any precedent for such a Clause. In respect to the right hon. Gentleman's defence of this Clause, I cannot imagine anything worse than what he said, that people coming from across the seas shall not have to pay 2d. to an exhibition! But the right hon. Gentleman forgot to add that if they go into the exhibition free of tax when they want to get to the entertainments which really amuse them or interest them, the fat lady, or try your strength, or try your skill, or other of the many things of the sort, they have to pay the tax. That, surely, will be a great grievance which may tend to dissolve that tie which the right hon. Gentleman is so anxious to create by the remission of this duty. There must be some other reason than that given by the right hon. Gentleman for his action. The reason, I suppose, is a desire to subsidise the exhibition. That may be a perfectly desirable thing to do, but if we desire to subsidise an exhibition, then the Treasury should come forward and ask Parliament to vote a certain sum of money in aid of the exhibition. That would be straightforward and a far more desirable way than by introducing an entirely new precedent into our fiscal practice by exempting, by name, one corporation or another.

Major ATTLEE: I was rather impressed by the speech of the right hon. Gentleman the Financial Secretary when he moved this particular Clause, for it seemed as though the hard financial expert had softened into a man of sensibility in his desire to knit the Empire together. But I trust that little breach which has been made in his heart will be healed. Appeals have been made which seem to me worthy of attention to remit portions of the Entertainments Duty. In the course of these discussions on the Finance Bill Members in all quarters of the House have mentioned instances of how hardly the Entertainments Duty bears on particular entertainments of one sort or another. This is the only case which apparently is going through, but I should like to remember the contrast with some of the other concessions for which we have asked in vain. I am interested, not financially, in certain matters where we suffer very much from the Entertainments Duty. I am interested in the performance, with-
out profits, of good dramas, and we should like to get a Clause exempting these particular things if winter comes.

Captain BERKELEY: In view of all that happened during the Committee stage, I think this is a perfectly monstrous proposal. On previous occasions in Committee the Government have said to the entertainments industry "We will not relieve you from taxation," and now it is proposed to pick out one particular entertainment which is likely to afford enjoyment to 30,000,000 or 40,000,000 people, and to this particular exhibition you say, "We will take off the Entertainment Duty" and in that way you are making a perfectly invidious distinction to what we know is already a flourishing industry, while you refuse this concession to industries that can hardly pay their own way. It is a thoroughly invidious proposal to relieve this particular exhibition in this way, thus reducing the price of admission from 1s. 3d. to 1s., making the exhibition an additional attraction to the general public, thus taking them away from other entertainments which have to pay the tax, and which are very hardly hit. In view of the fact that appeals were made from all quarters of the House to relieve the entertainments industry generally from taxation and those appeals were refused, I should like to know from what quarter the appeal to make this proposal came.

Sir W. JOYNSON-HICKS: May I say at once that I am very disappointed at the way in which this proposal has been received, because I thought it was a proposal which would commend itself to all quarters of the House. I observe, however, that that is not the case. The right hon. and learned Gentleman (Sir J. Simon), who is in charge of the Front Opposition Bench, made the statement that he was opposed to this Clause, and, under those circumstances, I am not disposed to press the matter by putting on the party Whips. It being the view, apparently, of those who have spoken in this Debate, that it is not desirable to pass this Clause, I shall not press it, and I may say at once that there was no request from anyone made to me that this Clause should be brought forward. It was one which we thought would be received favourably, even by the hon. and gallant Member for
Leith (Captain W. Benn), but, as he thinks that it will create an evil precedent and does not commend itself to his greater sense of taste than I possess, I ask leave to withdraw my Motion.

Motion and Clause, by leave, withdrawn.

NEW CLAUSE.—(Amendment of 9 and 10 Geo. V, c. 32, Section 16.)

Section sixteen of the Finance Act, 1919 (which exempts from Income Tax wounds and disability pensions) shall be extended to apply to pensions granted to widows whose husbands were killed as a result of naval, military, or air force service.—[Mr. Lawson.]

Brought up, and read the First time.

Mr. LAWSON: I beg to move, "That the Clause be read a Second time."
In the last Finance Bill the pensions of soldiers and disabled men were exempted from the Income Tax. In that case the House decided that soldiers' pensions were of an exceptional character. Now we are asking that the same principle should apply to widows' pensions granted as the result of losing their husbands, and that they also should be exempted from Income Tax. I do not think it is necessary to give reasons why this exemption should apply to widows' pensions. I have often thought that the burden is rather laid upon the Treasury Bench to give a reason why the tax on widows' pensions should be retained. The Financial Secretary gave a guarantee during the Committee stage that this matter would receive the careful consideration of the Chancellor of the Exchequer, and I am hopeful that the Financial Secretary is going to take the step we are asking him to take by relieving widows' pensions from taxation altogether.
The husbands of these women laid down their lives for the British Empire. They lost their lives not only in maintaining but in building up the British Empire, and if we can agree to do away with the tax in the case of an exhibition calling itself the British Empire Exhibition, then I think the right hon. Gentleman ought to agree to the abolition of the tax on widows pensions. The right hon. Gentleman has given some relief to the Income Tax payer and to shipping, and he has given relief to entertainments, and in various other ways, and that relief amounts to many millions. What we are
asking for now is to relieve a section of the community to an extent which would only cost the Exchequer about £100,000. I want the Financial Secretary to take this matter into his serious consideration, and I would like to put a question to him. When I moved an Amendment in regard to this matter in Committee I made it quite clear that it would not affect only the working classes and we did not move it as a class Amendment. We considered it a communal matter which we wanted to deal with in a communal sense. Since then I have had a letter on this subject, and I will refer to it because I want to have the facts accurate.
I wish to ask the right hon. Gentleman this question. When a woman is to be married the Pensions Minister can commute her pension, and give her the amount of the pension for 12 months, amounting to about £52. I have received a letter saying that a working woman received this £52 commutation money, and having spent all her savings before and part of whose furniture had gone, she is now to be married, and as the result of that she received this £52. I understand that it is the practice of the Exchequer to charge unearned Income Tax on that money, and I would like to know whether that is the case or not. I should be very pleased to hear that it is not the case, and I was astonished when I heard that statement. I am told that £13 has been deducted from that £52 because it has been charged as unearned income. I sincerely hope that that is not the practice of the Exchequer—and if it is, I hope it will soon be done away with—to treat the commutation pension as unearned income, because if ever income was earned it is certainly earned in that case. I ask the right hon. Gentleman to accept this new Clause.

Mr. F. ROBERTS: I beg to second the Motion.
When this matter was discussed during the Committee stage it received a measure of sympathetic attention from all parts of the House. Just now the right hon. Gentleman has been yielding to appeals on the ground that there was a general feeling in favour of them, but I am sure there is no proposal which will receive more sympathetic support from all sides of this chamber, and on the grounds
of elementary justice to a most deserving section of the community I want the Financial Secretary to give this matter that full and sympathetic consideration which we were led to believe during the Committee stage would be exercised in regard to this question. I believe when soldiers' pensions were exempted from this tax in 1919 it was generally understood that the tax on widows' pensions was to be included. Until the Act actually came into operation no one conceived that the widows' pensions had been included. By accepting this proposal the right hon. Gentleman will be doing something which I am sure will receive the heartiest possible support from all Members of this Chamber. The facts are so well understood that I feel it is not desirable that any further facts need be given, and I ask the right hon. Gentleman to give that sympathetic consideration which he has promised, and I hope he will accept this Clause.

Mr. WALLHEAD: I want to support this Clause, and I appeal to the right hon. Gentleman in charge of the Measure to carry out that sympathy which he expressed a short time ago in favour of the British Empire Exhibition into the region of practical assistance for the women who have been mentioned in this Amendment. I understand that the inclusion of this Clause in this Bill would mean a loss to the Revenue of about £100,000. The Financial Secretary has just been suggesting to the House a proposal that would cost the Treasury a great deal more than £100,000. My hon. Friend below the Gangway said it was probable that about 40,000,000 would visit the Empire Exhibition, and if you calculate that number at 3d. per head under the Entertainments Duty it means about £500,000. Therefore, the right hon. Gentleman was asking us to make a gift of £500,000 to the British Empire Exhibition, and here we are simply asking for a small measure of justice to the recipients of these pensions who have suffered so much. We are asking the right hon. Gentleman now to make this small gift to them for five years at least. We ask him to give away, in accordance with the generosity expressed by him a few moments ago, so much taxation as will at any rate relieve these pensions for five years. I hope he will accept this proposal.

Dr. MACNAMARA: I hope I may add my word to the appeals which have been made on behalf of this Amendment. I remember with gratitude the very kindly and sympathetic reply which the Financial Secretary made when this request was put to him, and I doubt whether it is at all necessary now to press it upon him. These poor women during the War had their hearts torn with anxiety; they have lost their husbands; they have lost not only the breadwinner but the loved one, and surely it ought not to be necessary to argue this case. I have, of course, no right to interpret the wishes of the House on this question, but I am sure we should all feel glad if the Treasury could find itself able to make this concession.

Mr. FOOT: I remember the Debate which took place last year on this proposal. There was a rather long discussion upon it, and those of us who were present will remember how moved the House was while the discussion was going on. A very noticeable point is that amongst those who supported the Amendment on the last occasion were some Members of the House who were supporters but were not then Members of the Government. To-day they occupy that position, and I think it will be found that some of those now on the Front Treasury Bench were last year so strongly convinced of the fairness of this proposal that they voted against the Government of that day. If they felt the matter so keenly at that time as to feel justified in voting against the Government of which they were followers, I hope that now they occupy positions of greater responsibility they may be able to bring influence to bear on their colleagues in the Government in order to get this concession granted. There is no argument at all for including widows' pensions for tax purposes. If we exempt disablement pensions, if we agree that payments made in respect of disablement should be eliminated from the tax calculations, surely we must admit it is equally proper that widows' pensions shall be put on the same footing. The right hon. Gentleman, in making an appeal for the exemption of the British Empire Exhibition, said that what was needed was a generous gesture. It is hardly necessary now to remind him of that phrase. Here we could make a generous gesture towards those whose services to the country can never be adequately
acknowledged. Seeing that the amount involved is so trifling, having regard to our income and expenditure, I suggest that here a generous gesture can be made without cutting into the vital principle of our financial organism.
I know it can be said that in making this concession we are not meeting the needs simply of the poor widow. My reply to that is whatever may be the position of a woman who is receiving some monetary consideration because of the loss of her husband, whatever may be her social position, the least the State can do is to refrain from imposing taxation upon the sum, small as it is, paid in acknowledgment of the services rendered by those who gave their lives in the War. It is merely a generous gesture that we now need, and I think that throughout the country there will be found no section of our people who will not welcome the making of this concession in respect of pensions and acknowledgement of the service of those who gave all they had to give.

Sir W. JOYNSON-HICKS: I regret that, after consultation with the Chancellor of the Exchequer, I am unable to make this concession. The hon. Member who last spoke appealed on the ground that the pension was too small. But that is not the question before us. That is a question which should have been dealt with by the House when the pensions were fixed.

Mr. FOOT: I know it is irksome to be interrupted, but when I said that the pensions were too little I used the words in the sense that any monetary allowance must of necessity be too little to express the gratitude of the nation to those who gave up their lives. It was in that sense that I used the expression.

Sir W. JOYNSON-HICKS: I accept the explanation of the hon. Member. At all events, the whole ground is that there would be a sum of money given to the widow if this tax were not insisted upon. Of course, the proper way is to increase the pension rather than to cut into the whole system of Income Tax administration. The hon. Member for Chester-le-Street (Mr. Lawson) said, quite frankly, he was not dealing with the case of poor widows. Of course, this does not affect the poor widow whose income is less than £3 per week; she would not get any
benefit from this Clause because she is already exempt from the tax. But take, for instance, the case of two widows, both with an income £500 a year. The income of one arises from investments; of the income of the other, £400 is from investments and £100 from the pension. Both are equally deserving, both have the same number of children to educate. Yet the one whose income is partly made up of the pension would, if this proposal were carried, be allowed an exemption which would not be afforded to the other. Then, again, take the case of a widow whose husband has been killed and who has received a payment under the Workmen's Compensation Act. If the compensation thus received has been invested and brings in an income above the limit of exemption, she will have to pay the Income Tax. All these exemptions would whittle away our system of Income Tax, and I appeal to hon. Members to realise the danger of that.
Before I was a Member of the Government we dealt with the case of disablement pension, but that was at a time when it was felt that nothing too great could be done in the interests of the men who were suffering. We always like to make any concessions we can to the widows of soldiers, but, having discussed this question with the Chancellor of the Exchequer, we feel that not only is a sum of £100,000 involved, but it would mean one more inroad into our Income Tax system. I entirely protest against the speech made by the right hon. Member for North Camberwell (Dr. Macnamara). It was a heart-moving speech, but may I remind the House that the right hon. Gentleman was a Member of the Government up till 1922, and that this concession was refused by the House of Commons on the advice of the Government of which he was a Member. He was the Minister of Pensions and very closely in touch with pension questions. I did not hear him speak in favour of this concession; I do not know whether he voted for it, but at any rate he remained a Member of the Government which had refused the concession, and, having omitted to use his great influence as a Cabinet Minister, which he could have done by resigning if he did not agree with the decision of his colleagues, I say it does not now lie in his hands—

Mr. FOOT: May I remind the right hon. Gentleman that he himself voted for this Amendment last year.

Sir W. JOYNSON-HICKS: I was not then a Member of the Government. The position is quite different. There are many cases where I have expressed approval of proposals in years past, but, when one realises the position from the point of view of the Minister responsible for the finances of the country, one has to give more consideration than a mere desire to express one's sympathy, as I did on that occasion.

Dr. MACNAMARA: And as I do now.

Sir W. JOYNSON-HICKS: The right hon. Gentleman at that time was a Minister.

Dr. MACNAMARA: I am expressing my sympathy now.

Sir W. JOYNSON-HICKS: I am a Minister now; I am not at liberty to express my sympathy, and I am going to appeal to the House with a greater knowledge of the basis of the finances of the country, and a greater knowledge of the system of our Income Tax law. However great the desire may be to help the widows of our soldiers, I am going to remind Members that the real remedy is to increase the pension.

Dr. MACNAMARA: Do you propose to do that?

Mr. LAWSON: Before the right hon. Gentleman sits down will he deal with the particular case I mentioned?

Sir W. JOYNSON-HICKS: Yes. I repeat that if in the opinion of the House these widows' pensions are not sufficient, then they should be increased, but we ought not to make inroads on our system of Income Tax, because it would only pave the way for demands for still further inroads. With regard to the question put to me by the hon. Member for Chester-le-Street, I have been making some inquiries. The Minister of Pensions is not here at the moment, and therefore I cannot give a full answer to-day. But I will say this, that these pensions are always treated as earned income for Income Tax purposes, and not as unearned income. The hon. Member mentioned the case of a war widow who, on remarriage, was given a final bonus to clear up her
pension and was charged tax on it as unearned income. I will make the fullest inquiry, and if it be possible by administrative action to remedy the grievance to which he refers, I will do my level best to see that it is done.

7.0 P.M.

Mr. HASTINGS: I do not propose to say anything on what I may call the sentimental point of view, because I do not think it quite fair, as hon. Members on every side of the House have precisely the same feelings in this matter. Neither do I propose to discuss the changed position of Members who have become Ministers and are unable to give effect to the views they expressed before they accepted office. But I do want to suggest that the argument put forward by the right hon. Gentleman is wrong.
The real and the sole objection to this—it cannot be a question merely of £100,000—is that it is an inroad on the question of taxation of pensions, and places these particular people in an invidious position in regard to other widows and persons similarly affected. With great respect, the right hon. Gentleman is wrong. He should remember that the ordinary young couple who marry never could marry and incur the responsibility of marriage if they thought that the income of the husband was going to remain what it was when they married. People in middle-class life marry because they think their income will increase as the years go by. When a woman marries a subaltern she cannot think that he is always going to remain in that position. She hopes that he will rise in his profession, and that their income will become greater. The people we are really considering here are in much the largest percentage of cases young women whose husbands were killed when they were quite young, and whose pension is assessed upon an income on which she never hoped to live afterwards with her child. The real reason for the great hardship is that her pension is based on a starvation income. There is no analogy between the widow of a subaltern who is left to live on that and the widow of a workman who has lived for 30 or 40 years with her and has got to the highest point that they could reasonably expect.
There is no analog between the widow of a young officer or soldier killed in the
War and any other widow at all. I am not suggesting that it is a question of philanthropy or one for relief on any pathetic grounds. It is a matter of hard fact. In reply to all the sympathetic arguments the right hon. Gentleman has put forward an argument of fact, but there is no class of persons in the community similarly placed to these women. I urge the right hon. Gentleman to consider that, and to remember that if not all, 90 per cent. of these widows, if they had thought that their life was to be based on their husband's income at the time they were married, would never have married, and now that their husbands are killed they are placed in the position of being unable to provide properly for themselves and their children.

Major ATTLEE: I do not propose to join in the controversy of "the Devil was sick; the Devil a monk would be," or to judge nicely between the repentant sinner on my left and the one who is going on in sin on the bench opposite. I do think, however, that from that discussion we can, perhaps, sum up clearly what is meant by imperial and patriotic sentiment. Apparently, it means giving to Imperial exihibitions but not doing anything for widows. I do not want to go strongly on the pathetic line, but I do want to point out the right hon. Gentleman's inconsistency. He does not argue it on the ground of expense, but solely on his financial consistency and his desire to keep intact the Income Tax Acts. And this comes from the right hon. Gentleman who has proposed an exception to the Income Tax Act for one particular thing!

Sir W. JOYNSON-HICKS: No.

Major ATTLEE: When you have a particular class that makes a strong pathetic appeal to Members of this House the right hon. Gentleman takes refuge behind his financial consistency. I think it is clear that you have had a definite breach made in the Income Tax Acts by the wounds and disability pensions. He said that we did that in the War, and that we had to do it for the soldier, but some years afterwards they are not so important. [HON. MEMBERS: "No!"] That is the experience of ex-service men all over the country. [HON. MEMBERS: "No!"] And you can see it written
on boards in words in which, they express what they mean when they say that the country needed them in 1914 but that in 1923 they can go hang. It sums up their view, and we shall see on this Vote exactly how much worth have the professions of patriotism and Imperialism that we get so very freely from the Front Bench below the Gangway. I appeal to the right hon. Gentleman to reconsider the matter. It is a question of £100,000, but we know that the Budget has not been drawn so closely as not to have something to play with. He had something to play with on the Entertainments Duty, and here is something with which at the eleventh hour he can avoid being placed in the position of the right hon. Member for Camberwell (Dr. Macnamara) of being pointed at and told, "When you were in power you did not do it." I think the right hon. Gentleman is in a much better strategic position in this matter than the right hon. Member for Camberwell, and I hope he will use his advantage and give his true and sympathetic support to this new Clause.

Lieut.-Colonel PAGE CROFT: I want to correct what may be a misapprehension. The hon. and learned Gentleman on the Front Bench, who represents the Labour party (Mr. Hastings), was stating the case of the widow of a subaltern and her pension. I may be wrong, but I should imagine that that case would not be affected under this Bill unless her total income was £150 a year or more. I do not think she would be affected.

Captain W. BENN: I wish to ask whether the Financial Secretary to the Treasury cannot do one thing. I think he will recognise that there is a very general feeling in all parts of the House that this exemption should be extended from wounds and disability pensions to widows' pensions. He admitted that when he voted for the proposal himself. It is really an extension that can be justified. If we can justify an exemption for wounds and disability pensions, surely we can justify it for a widow's pension. Section 16 of the Act of 1919 is well known, and, that being the case, cannot the right hon. Gentleman see his way to take off the Government Whips at this Division? We had a Motion the other night in which certain private
Members on the other side of the House pointed out that some of the land taxes caused some trouble and expense to individuals, and the Financial Secretary was able to say that, rather than force his Friends into a position they did not want to occupy, he would take off the Whips. Why not let the House express a free opinion now? That is the least he can do in a matter that, last year, had his support in the Division Lobby.

Mr. LINFIELD: I appeal to the right hon. Gentleman to accede to the request which has just been made to him to take off the Whips. I am certain that hon. Members opposite have just as much sympathy with these widows as we have. I have seen the list of Members who voted on this matter in the last Parliament, and I have no doubt that there are quite a number on the opposite side of the House who would like to vote for this new Clause.

Sir F. BANBURY: Give us the chance, then!

Mr. LINFIELD: We will see what you will do when you get your chance. On the question of principle, it has already been admitted that no new principle is introduced, because the principle is admitted on the question of disablement. With regard to funds, the right hon. Gentleman is well aware that we have just saved half-a-million of money, so there will be no dislocation of the Budget on this proposal. I am giving the figures estimated by someone else, but there will certainly be sufficient to make good this small concession for which we are asking now. I hope he will see his way to do this, so that his supporters will vote according to their consciences, the way in which they voted in the last Parliament, and in which he voted when in a position of less responsibility. By taking off the Whips he will get to know exactly the feeling of the House. No harm will be done, and no great loss will ensue even if this suggestion be carried into effect.

Sir W. JOYNSON-HICKS: I should like to say that there is no such sum as has been mentioned in this year's Budget. Anything to do with the Empire Exhibition would be in next year's Budget.

Question put, "That the Clause be read a Second time."

The House divided: Ayes, 153; Noes, 227.

Division No. 258.]
AYES.
[7.13 p.m.


Alexander, A. V. (Sheffield, Hillsbro')
Hay, Captain J. P. (Cathcart)
Potts, John S.


Ammon, Charles George
Hayes, John Henry (Edge Hill)
Pringle, W. M. R.


Attlee, C. R.
Hemmerde, E. G.
Rees, Sir Beddoe


Barker, G. (Monmouth, Abertillery)
Henderson, Rt. Hon. A. (N'castle, E.)
Riley, Ben


Batey, Joseph
Herriotts, J.
Roberts, C. H. (Derby)


Benn, Captain Wedgwood (Leith)
Hill, A.
Roberts, Frederick O. (W. Bromwich)


Bennett, A. J. (Mansfield)
Hillary, A. E.
Robertson, J. (Lanark, Bothwell)


Berkeley, Captain Reginald
Hinds, John
Royce, William Stapleton


Bonwick, A.
Hirst, G. H.
Saklatvala, S.


Broad, F. A.
Hodge, Rt. Hon. John
Salter, Dr. A.


Brotherton, J.
Hutchison, Sir R. (Kirkcaldy)
Scrymgeour, E.


Burnie, Major J. (Bootle)
Irving, Dan
Sexton, James


Butler, J. R. M. (Cambridge Univ.)
Jenkins, W. (Glamorgan, Neath)
Shaw, Hon. Alex. (Kilmarnock)


Buxton, Charles (Accrington)
John, William (Rhondda, West)
Shaw, Thomas (Preston)


Buxton, Noel (Norfolk, North)
Johnston, Thomas (Stirling)
Shinwell, Emanuel


Chapple, W. A.
Jones, Henry Haydn (Merioneth)
Short, Alfred (Wednesbury)


Clarke,. Sir E. C.
Jones, J. J. (West Ham, Silvertown)
Simon, Rt. Hon. Sir John


Clynes, Rt. Hon. John R.
Jones, Morgan (Caerphilly)
Sinclair, Sir A.


Cohen, Major J. Brunel
Jones, R. T. (Carnarvon)
Snell, Harry


Collins, Sir Godfrey (Greenock)
Jones, T. I. Mardy (Pontypridd)
Snowden, Philip


Collins, Pat (Walsall)
Jowett, F. W. (Bradford, East)
Spears, Brig.-Gen. E. L.


Darbishire, C. W.
Jowitt, W. A. (The Hartlepools)
Spencer, George A. (Broxtowe)


Davies, Evan (Ebbw Vale)
Kenyon, Barnet
Stephenson, Lieut-Colonel H. K.


Davies, J. C. (Denbigh, Denbigh)
Lambert, Rt. Hon. George
Stewart, J. (St. Rollox)


Davies, Rhys John (Westhoughton)
Lansbury, George
Sutherland, Rt. Hon. Sir William


Davison, J. E. (Smethwick)
Lawson, John James
Thomas, Sir Robert John (Anglesey)


Dudgeon, Major C. R.
Leach, W.
Thomson, T. (Middlesbrough, West)


Duffy, T. Gavan
Lee, F.
Thorne, W. (West Ham, Plaistow)


Duncan, C.
Lees-Smith, H. B. (Keighley)
Thornton, M.


Dunnico, H.
Linfield, F. C.
Trevelyan, C. P.


Ede, James Chuter
Lowth, T.
Turner, Ben


Edge, Captain Sir William
MacDonald, J. R. (Aberavon)
Wallhead, Richard C.


Edmonds, G.
Macdonald, Sir Murdoch (Inverness)
Walsh, Stephen (Lancaster, Ince)


Edwards, C. (Monmouth, Bedwellty)
M'Entee, V. L.
Watson, W. M. (Dunfermline)


Entwistle, Major C. F.
McLaren, Andrew
Watts-Morgan, Lt.-Col. D. (Rhondda)


Falconer, J.
Macnamara, Rt. Hon. Dr. T. J.
Webb, Sidney


Foot, Isaac
Macpherson, Rt. Hon. James I.
Wedgwood, Colonel Josiah C.


Gardiner, James
March, S.
Weir, L. M.


Gilbert, James Daniel
Marshall, Sir Arthur H.
Whiteley, W.


Gosling, Harry
Martin, F. (Aberd'n & Kinc'dine, E.)
Williams, David (Swansea, E.)


Graham, W. (Edinburgh, Central)
Middleton, G.
Williams, Dr. J. H. (Llanelly)


Greenall, T.
Moreing, Captain Algernon H.
Williams, T. (York, Don Valley)


Greenwood, A. (Nelson and Colne)
Morel, E. D.
Wilson, C. H. (Sheffield, Attercliffe)


Grenfell, D. R. (Glamorgan)
Morrison, R. C. (Tottenham, N.)
Winfrey, Sir Richard


Groves, T.
Murray, Hon. A. C. (Aberdeen)
Wintrinqham, Margaret


Grundy, T. W.
Murray, John (Leeds, West)
Wood, Major M. M. (Aberdeen, C.)


Hall, F. (York, W.R., Normanton)
O'Grady, Captain James
Wright, W.


Hamilton, Sir R. (Orkney & Shetland)
Oliver, George Harold
Young, Rt. Hon. E. H. (Norwich)


Hardie, George D.
Paling, W.
Young, Robert (Lancaster, Newton)


Harney, E. A.
Parry, Lieut.-Colonel Thomas Henry



Harris, Percy A.
Phillipps, Vivian
TELLERS FOR THE AYES.—


Hastings, Patrick
Ponsonby, Arthur
Mr. T. Griffiths and Mr. Lunn.




NOES.


Agg-Gardner, Sir James Tynte
Buckingham, Sir H.
Croft, Lieut.-Colonel Henry Page


Alexander, E. E. (Leyton, East)
Buckley, Lieut.-Colonel A.
Crook, C. W. (East Ham. North)


Alexander, Col. M. (Southwark)
Bull, Rt. Hon. Sir William James
Crooke, J. Smedley (Deritend)


Amery, Rt. Hon. Leopold C. M. S.
Burn, Colonel Sir Charles Rosdew
Dalziel, Sir D. (Lambeth, Brixton)


Archer-Shee, Lieut.-Colonel Martin
Burney, Com. (Middx., Uxbridge)
Davidson, J. C. C. (Hemel Hempstead)


Ashley, Lt.-Col. Wilfrid W.
Butcher, Sir John George
Davidson, Major-General Sir J. H.


Baldwin, Rt. Hon. Stanley
Butler, H. M. (Leeds, North)
Davison, Sir W. H. (Kensington, S.)


Balfour, George (Hampstead)
Butt, Sir Alfred
Dawson, Sir Philip


Banbury, Rt. Hon. Sir Frederick G.
Cadogan, Major Edward
Du Pre, Colonel William Baring


Banks, Mitchell
Campion, Lieut.-Colonel W. R.
Edmondson, Major A. J.


Barlow, Rt. Hon. Sir Montague
Cayzer, Sir C. (Chester, City)
Ednam, Viscount


Barnett, Major Richard W.
Cecil, Rt. Hon. Sir Evelyn (Aston)
Elliot, Capt. Walter E. (Lanark)


Barnston, Major Harry
Cecil, Rt. Hon. Lord H. (Ox. Univ.)
Ellis, R. G.


Bell, Lieut. Col. W. C. H. (Devizes)
Chadwick, Sir Robert Burton
Erskine, James Malcolm Monteith


Benn, Sir A. S. (Plymouth, Drake)
Chamberlain, Rt. Hn. J. A. (Birm. W.)
Erskine, Lord (Weston-super-Mare)


Bennett, Sir T. J. (Sevenoaks)
Chamberlain, Rt. Hon. N. (Ladywood)
Erskine-Bolst, Captain C.


Berry, Sir George
Churchman, Sir Arthur
Eyres-Monsell, Com. Bolton M.


Betterton, Henry B.
Clarry, Reginald George
Falcon, Captain Michael


Birchall, Major J. Dearman
Clayton, G. C.
Falle, Major Sir Bertram Godfray


Bird, Sir William B. M. (Chichester)
Cobb, Sir Cyril
Fawkes, Major F. H.


Blades, Sir George Rowland
Cockerill, Brigadier-General G. K.
Flanagan, W. H.


Bowyer, Capt. G. E. W.
Colfox, Major Wm. Phillips
Ford, Patrick Johnston


Boyd-Carpenter, Major A.
Colvin, Brig. General Richard Beale
Foreman, Sir Henry


Brass, Captain W.
Conway, Sir W. Martin
Forestier, Walker, L.


Bridgeman, Rt. Hon. William Clive
Cope, Major William
Fremantle, Lieut.-Colonel Francis E.


Brown, Brig.-Gen. Clifton (Newbury)
Craiq, Captain C. C. (Antrim, South)
Furness, G. J.


Bruton, Sir James
Craik, Rt. Hon. Sir Henry
Galbraith, J. F. W.




Ganzoni, Sir John
Lorden, John William
Russell-Wells, Sir Sydney


Garland, C. S.
Lorimer, H. D.
Samuel, A. M. (Surrey, Farnham)


Gates, Percy
Lort-Williams, J.
Samuel, Samuel (W'dsworth, Putney]


Gaunt, Rear-Admiral Sir Guy R.
Loyd, Arthur Thomas (Abingdon)
Sanderson, Sir Frank B.


Gilmour, Lt.-Col. Rt. Hon. Sir John
Lumley, L. R.
Sandon, Lord


Gould, James C.
Macnaghten, Hon. Sir Malcolm
Sassoon, Sir Philip Albert Gustave D.


Greene, Lt.-Col. Sir W. (Hack'y, N.)
McNeill, Ronald (Kent, Canterbury)
Scott, Sir Leslie (Liverp'l, Exchange)


Grenfell, Edward C. (City of London)
Maitland, Sir Arthur D. Steel-
Shepperson, E. W.


Gretton, Colonel John
Makins, Brigadier-General E.
Shipwright, Captain D.


Guinness, Lieut.-Col. Hon. W. E.
Malone, Major P. B. (Tottenham, S.)
Skelton, A. N.


Gwynne, Rupert S.
Margesson, H. D. R.
Smith, Sir Allan M. (Croydon, South)


Hacking, Captain Douglas H.
Mason, Lieut.-Col. C. K.
Somerville, Daniel (Barrow-in-Furness)


Hall, Rr-Adml Sir W. (Liv'p'l,W.D'by)
Mercer, Colonel H.
Spender-Clay, Lieut.-Colonel H. H.


Halstead, Major D.
Milne, J. S. Wardlaw
Stanley, Lord


Hamilton, Sir George C. (Altrincham)
Mitchell, W. F. (Saffron Walden)
Steel, Major S. Strang


Harvey, Major S. E.
Mitchell, Sir W. Lane (Streatham)
Stewart, Gershom (Wirral)


Hawke, John Anthony
Morrison, Hugh (Wilts, Salisbury)
Stott, Lt.-Col. W. H.


Hay, Major T. W. (Norfolk, South)
Murchison, C. K.
Stuart, Lord C. Crichton-


Henn, Sir Sydney H.
Nesbitt, Robert C.
Sueter, Rear-Admiral Murray Fraser


Hennessy, Major J. R. G.
Newman, Colonel J. R. P. (Finchley)
Sugden, Sir Wilfrid H.


Herbert, Dennis (Hertford, Watford)
Newman, Sir R. H. S. D. L. (Exeter)
Sykes, Major-Gen. Sir Frederick H.


Hewett, Sir J. P.
Newson, Sir Percy Wilson
Terrell, Captain R. (Oxford, Henley]


Hilder, Lieut.-Colonel Frank
Newton, Sir D. G. C. (Cambridge)
Thompson, Luke (Sunderland)


Hiley, Sir Ernest
Nicholson, William G. (Petersfield)
Thomson, F. C. (Aberdeen, South)


Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Nield, Sir Herbert
Thorpe, Captain John Henry


Hogg, Rt. Hon. Sir D. (St. Marylebone)
O'Neill, Rt. Hon. Hugh
Titchfield, Marquess of


Holbrook, Sir Arthur Richard
Ormsby-Gore, Hon. William
Tryon, Rt. Hon. George Clement


Hood, Sir Joseph
Paget, T. G.
Tubbs, S. W.


Hopkins, John W. W.
Parker, Owen (Kettering)
Turton, Edmund Russborough


Hopkinson, A. (Lancaster, Mossley)
Pease, William Edwin
Ward, Col. L. (Kingston-upon-Hull)


Howard, Capt. D. (Cumberland, N.)
Percy, Lord Eustace (Hastings)
Watts, Dr. T. (Man., Withington)


Hudson, Capt. A.
Perkins, Colonel E. K.
Wells, S. R.


Hughes, Collingwood
Perring, William George
Weston, Colonel John Wakefield


Hume, G. H.
Pilditch, Sir Philip
Wheler, Col. Granville C. H.


Hunter-Weston, Lt.-Gen. Sir Aylmer
Pollock, Rt. Hon. Sir Ernest Murray
White, Lt.-Col. G. D. (Southport)


Hurst, Lieut.-Colonel Gerald B.
Pownall, Lieut.-Colonel Assheton
Whitla, Sir William


Hutchison, G. A. C. (Midlothian, N.)
Pretyman, Rt. Hon. Ernest G.
Winterton, Earl


Inskip, Sir Thomas Walker H.
Privett, F. J.
Wise, Frederick


Jackson, Lieut.-Colonel Hon. F. S.
Raine, W.
Wolmer, viscount


James, Lieut.-Colonel Hon. Cuthbert
Rawlinson, Rt. Hon. John Fredk. Peel
Wood, Rt. Hn. Edward F. L. (Ripon)


Jephcott, A. R.
Remer, J. R.
Wood, Maj. Sir S. Hill- (High Peak)


Johnson, Sir L. (Walthamstow, E.)
Rhodes, Lieut.-Col. J. P.
Woodcock, Colonel H. C.


Jones, G. W. H. (Stoke Newington)
Richardson, Sir Alex. (Gravesend)
Worthington-Evans, Rt. Hon. Sir L.


Joynson-Hicks, Sir William
Richardson, Lt.-Col. Sir P. (Chertsey)
Yate, Colonel Sir Charles Edward


Kennedy, Captain M. S. Nigel
Roberts, Samuel (Hereford, Hereford)
Yerburgh, R. D. T.


King, Captain Henry Douglas
Robertson-Despencer, Major (Islgtn, W.)



Kinloch-Cooke, Sir Clement
Rothschild, Lionel de
TELLERS FOR THE NOES.—


Lamb, J. Q.
Roundell, Colonel R. F.
Colonel Leslie Wilson and Colonel


Lane-Fox, Lieut.-Colonel G. R.
Ruggles-Brise, Major E.
Gibbs.


Lloyd-Greame, Rt. Hon. Sir P.
Russell, William (Bolton)

NEW CLAUSE.—(Deduction in respect of person acting as housekeeper for widower or widow.)

(1) If an individual proves that he is a widower and that for the year of assessment a person, being a female relative of his or of his deceased wife, is resident with him in the capacity of housekeeper, he shall, subject as hereinafter provided, be entitled to a deduction of forty-five pounds in respect of that person.

Provided that—

(a) No deduction shall be allowed under this Section unless the individual proves that no other individual is entitled to a deduction in respect of the same person under the provisions of Part II of the Finance Act, 1920, as amended by any subsequent enactment, or, if any other individual is so entitled, that the other individual has relinquished his claim thereto; and
(b) No deduction shall be allowed under this Section where the person is a married woman living with her husband, and the husband has
134
claimed and been allowed a deduction of two hundred and twenty-five pounds under the provisions of Part II of the Finance Act, 1920, as amended by any subsequent enactment.

(2) This Section shall apply to an individual being a widow as it applies to an individual being a widower.—[Mr. Turner.]

Brought up, and read the First time.

Mr. TURNER: I beg to move, "That the Clause be read a Second time."
I desire to make a special appeal to the Minister in charge of the Bill. Not many concessions have been made to what I may term the ordinary people of this Kingdom through the Finance Bill, and it seems to me that this is but a simple and humane proposal. I know that allowances are made to widowers who have children, but I think the allowance should be extended to widowers even without children. I know of many decent men who have lost their wives,
and whose mothers have become their housekeepers, and it does seem to me that, when a man has lost his wife, and his mother, or sister or aunt, or other relative acts as his housekeeper, there ought to be no hesitation whatever in giving him the benefit of the exemption of £45 that the widower with children gets. When a man in that position requires a housekeeper, who is the best housekeeper for him under such conditions? It is certainly one of his own relatives. Many a man who has lost his wife does not want to get married again, because he has a great regard for the memory of the departed one. There are some who undertake a second venture but many a man who loses a good wife and has a dear memory for that good wife is not always anxious to get married again. It does seem to me that, if a mother or a sister or other relative is looking after the household of such a man, he ought to be entitled to the exemption that a widower with children now has. His trouble is enough in losing his wife, and it ought not to be made more by a charge when he has a relative as his housekeeper. When this proposal was discussed before, that an allowance should be given to a widower in respect of his housekeeper, it was said that the housekeeper might be another person than a relative, and that that might lead to morals being undermined. I am one of those old-fashioned folk who believe in the high morals of the home, and I would have no taxation that would interfere with those high morals, but in this case the Clause merely provides that the allowance shall be given in respect of a relative.

Mr. LEES-SMITH: I beg to second the Motion.

Sir W. JOYNSON-HICKS: This, I think, is an easier Clause to resist than some which have been brought forward. Under the present Income Tax law, when there are young children and a housekeeper is necessary, an allowance of £45 is given, but this Clause seeks to go further and give an allowance for a housekeeper where there are no young children. I know that the hon. Member who brings forward this proposal was not in the previous Parliament, but the proposal has been debated many times, and has been defeated by considerable majorities.

MR. TURNER: It is still right.

Sir W. JOYNSON-HICKS: Of course, the hon. Member is quite entitled to take that view, and assume that the minority is very often more right than the majority I explained during the Committee stage that the whole of these Income Tax provisions emanated from the Royal Commission, on which there were three Members of the Labour party, namely, the hon. Member for Central Edinburgh (Mr. W. Graham), the right hon. Gentleman the Member for Deptford (Mr. Bowerman), and Mr. Brace, who is no longer a Member of the House. Nowhere, however, in the Report of the Royal Commission do I find any suggestion that there should be this exemption. Many other exemptions were included in the Report, and I think most of them have already been passed into law, but I although, as I have said, the Commission included three Members of the Labour party, they expressed no disapproval and made no separate Report on this question. In these circumstances, I must ask the House to abide by its previous decision, and not to accept this Clause.

Mr. T. WILLIAMS: Would not the right hon. Gentleman consider the case where there happen to be one or two sons, say between 16 and 18 years of age? Is it not fair to assume that domestic help is necessary in such a home, and would very often prevent the father from taking the wrong course, and help to guide the children along the path that they ought to travel? I think the right hon. Gentleman does not give to this proposal its full face value. Where the wife has gone, some domestic assistance becomes necessary, and in the case of a relative of the widower or of his deceased wife, if she is brought into the home as housekeeper, the cost to the widower is just the same as when his wife was alive. On the other hand, the right hon. Gentleman's refusal would imply that he desires to impose a penalty on the widower for having lost his wife. I hope he will give more consideration than he appears to have given to this case. If he will do so, I think he will feel bound to do more than he professes at the present moment.

Question put, "That the Clause be read a Second time."

The House divided: Ayes, 146 Noes, 233.

Division No. 259.]
AYES.
[7.28 p.m.


Alexander, A. V. (Sheffield, Hillsbro')
Hill, A.
Riley, Ben


Attlee, C. R.
Hillary, A. E.
Ritson, J.


Barker, G. (Monmouth, Abertillery)
Hinds, John
Roberts, C. H. (Derby)


Batey, Joseph
Hirst, G. H.
Roberts, Frederick O. (W. Bromwich)


Bennett, A. J. (Mansfield)
Hodge, Rt. Hon. John
Robertson, J. (Lanark, Bothwell)


Berkeley, Captain Reginald
Irving, Dan
Royce, William Stapleton


Bonwick, A.
Jenkins, W. (Glamorgan, Neath)
Saklatvala, S.


Bowerman, Rt. Hon. Charles W.
John, William (Rhondda, West)
Salter, Dr. A.


Broad, F. A.
Johnston, Thomas (Stirling)
Scrymgeour, E.


Brotherton, J.
Jones, Henry Haydn (Merioneth)
Sexton, James


Burnie, Major J. (Bootle)
Jones, J. J. (West Ham, Silvertown)
Shakespeare, G. H.


Buxton, Charles (Accrington)
Jones, Morgan (Caerphilly)
Shaw, Hon. Alex. (Kilmarnock)


Buxton, Noel (Norfolk, North)
Jones, R. T. (Carnarvon)
Shaw, Thomas (Preston)


Chapple, W. A.
Jones, T. I. Mardy (Pontypridd)
Shinwell, Emanuel


Clarke, Sir E. C.
Jowett, F. W. (Bradford, East)
Short, Alfred (Wednesbury)


Collins, Sir Godfrey (Greenock)
Jowitt, W. A. (The Hartlepools)
Simon, Rt. Hon. Sir John


Collins, Pat (Walsall)
Kenyon, Barnet
Sinclair, Sir A.


Darbishire, C. W.
Lambert, Rt. Hon. George
Snell, Harry


Davies, Evan (Ebbw Vale)
Lansbury, George
Snowden, Philip


Davies, J. C. (Denbigh, Denbigh)
Lawson, John James
Spencer, George A. (Broxtowe)


Davies, Rhys John (Westhoughton)
Leach, W.
Stephenson, Lieut.-Colonel H. K.


Davison, J. E. (Smethwick)
Lee, F.
Stewart, J. (St. Rollox)


Dudgeon, Major C. R.
Lees-Smith, H. B. (Keighley)
Thomas, Sir Robert John (Anglesey)


Duffy, T. Gavan
Linfield, F. C.
Thomson, T. (Middlesbrough, West)


Dunnico, H.
Lowth, T.
Thorne, W. (West Ham, Plaistow)


Ede, James Chuter
Lunn, William
Thornton, M.


Edmonds, G.
MacDonald, J. R. (Aberavon)
Trevelyan, C. P.


Edwards, C. (Monmouth, Bedwellty)
M'Entee, V. L.
Turner, Ben


Entwistle, Major C. F.
McLaren, Andrew
Wallhead, Richard C.


Falconer, J.
Macnamara, Rt. Hon. Dr. T. J.
Walsh, Stephen (Lancaster, Ince)


Foot, Isaac
March, S.
Watson, W. M. (Dunfermline)


Gilbert, James Daniel
Marshall, Sir Arthur H.
Watts-Morgan, Lt.-Col. D. (Rhondda)


Gosling, Harry
Martin, F. (Aberd'n & Kinc'dine, E.)
Webb, Sidney


Greenall, T.
Middleton, G.
Wedgwood, Colonel Josiah C.


Greenwood, A. (Nelson and Colne)
Mond, Rt. Hon. Sir Alfred Moritz
Weir, L. M.


Grenfell, D. R. (Glamorgan)
Morel, E. D.
White, Charles F. (Derby, Western)


Groves, T.
Morrison, R. C. (Tottenham, N.)
Whiteley, W.


Grundy, T. W.
Mosley, Oswald
Williams, David (Swansea, E.)


Guest, Hon. C. H. (Bristol, N.)
Murray, Hon. A. C. (Aberdeen)
Williams, Dr. J. H. (Llanelly)


Hall, F. (York, W. R., Normanton)
Murray, John (Leeds, West)
Williams, T. (York, Don Valley)


Hamilton, Sir R. (Orkney & Shetland)
O'Grady, Captain James
Wilson, C. H. (Sheffield, Attercliffe)


Hardie, George D.
Oliver, George Harold
Winfrey, Sir Richard


Harney, E. A.
Paling, W.
Wintringham, Margaret


Harris, Percy A.
Parry, Lieut.-Colonel Thomas Henry
Wood, Major M. M. (Aberdeen, C.)


Hastings, Patrick
Pattinson, S. (Horncastle)
Wright, W.


Hay, Captain J. P. (Cathcart)
Phillipps, Vivian
Young, Robert (Lancaster, Newton)


Hayes, John Henry (Edge Hill)
Ponsonby, Arthur



Hemmerde, E. G.
Potts, John S.
TELLERS FOR THE AYES.—


Henderson, Rt. Hon. A. (N'castle, E.)
Pringle, W. M. R.
Mr. T. Griffiths and Mr. Ammon.


Herriotts, J.
Rees, Sir Beddoe





NOES.


Agg-Gardner, Sir James Tynte
Burn, Colonel Sir Charles Rosdew
Davidson, Major-General Sir J. H.


Alexander, E. E. (Leyton, East)
Burney, Com. (Middx., Uxbridge)
Davies, Alfred Thomas (Lincoln)


Alexander, Col. M. (Southwark)
Butler, H. M. (Leeds, North)
Davison, Sir W. H. (Kensington, S.)


Amery, Rt. Hon. Leopold C. M. S.
Butt, Sir Alfred
Dixon, C. H. (Rutland)


Archer-Shee, Lieut.-Colonel Martin
Cadogan, Major Edward
Doyle, N. Grattan


Ashley, Lt.-Col. Wilfrid W.
Campion, Lieut.-Colonel W. R.
Du Pre, Colonel William Baring


Baldwin, Rt. Hon. Stanley
Cayzer, Sir C. (Chester, City)
Edmondson, Major A. J.


Balfour, George (Hampstead)
Cecil, Rt. Hon. Sir Evelyn (Aston)
Ednam, Viscount


Banks, Mitchell
Cecil, Rt. Hon. Lord H. (Ox. Univ.)
Elliot, Capt. Walter E. (Lanark)


Barlow, Rt. Hon. Sir Montague
Chadwick, Sir Robert Burton
Ellis, R. G.


Barnett, Major Richard W.
Chamberlain, Rt. Hn. J. A. (Birm. W.)
Erskine, Lord (Weston-super-Mare)


Barnston, Major Harry
Chamberlain, Rt. Hon. N. (Ladywood)
Erskine-Bolst, Captain C.


Bell, Lieut.-Col. W. C. H. (Devizes)
Churchman, Sir Arthur
Eyres-Monsell, Com. Bolton M.


Benn, Sir A. S. (Plymouth, Drake)
Clarry, Reginald George
Falcon, Captain Michael


Berry, Sir George
Clayton, G. C.
Falle, Major Sir Bertram Godfray


Betterton, Henry B.
Cobb, Sir Cyril
Fawkes, Major F. H.


Birchall, Major J. Dearman
Cockerill, Brigadier-General G. K.
Flanagan, W. H.


Bird, Sir William B. M. (Chichester)
Cohen, Major J. Brunel
Ford, Patrick Johnston


Blades, Sir George Rowland
Colfox, Major Wm. Phillips
Foreman, Sir Henry


Bowyer, Capt. G. E. W.
Colvin, Brig.-General Richard Beale
Forestier-Walker, L.


Boyd-Carpenter, Major A.
Conway, Sir W. Martin
Foxcroft, Captain Charles Talbot


Brass, Captain W.
Cope, Major William
Fremantle, Lieut.-Colonel Francis E.


Bridgeman, Rt. Hon. William Clive
Craig, Captain C. C. (Antrim, South)
Furness, G. J.


Brown, Major D. C. (Hexham)
Craik, Rt. Hon. Sir Henry
Galbraith, J. F. W.


Brown, Brig.-Gen. Clifton (Newbury)
Croft, Lieut.-Colonel Henry Page
Ganzoni, Sir John


Bruton, Sir James
Crook, C. W. (East Ham, North)
Gardiner, James


Buckingham, Sir H.
Crooke, J. Smedley (Deritend)
Garland, C. S.


Buckley, Lieut.-Colonel A.
Dalziel, Sir D (Lambeth, Brixton)
Gates, Percy


Bull, Rt. Hon. Sir William James
Davidson, J. C. C. (Hemel Hempstead)
Gaunt, Rear-Admiral Sir Guy R.




Gilmour, Lt.-Col. Rt. Hon. Sir John
Lorden, John William
Russell-Wells, Sir Sydney


Goff, Sir R. Park
Lorimer, H. D.
Samuel, A. M. (Surrey, Farnham)


Gould, James C.
Lort-Williams, J.
Samuel, Samuel (W'dsworth, Putney)


Greene, Lt.-Col. Sir W. (Hack'y, N.)
Loyd, Arthur Thomas (Abingdon)
Sanderson, Sir Frank B.


Grenfell, Edward C. (City of London)
Lumley, L. R.
Sandon, Lord


Gretton, Colonel John
Macnaghten, Hon. Sir Malcolm
Scott, Sir Leslie (Liverp'l, Exchange)


Guinness, Lieut.-Col. Hon. W. E.
McNeill, Ronald (Kent, Canterbury)
Sheffield, Sir Berkeley


Gwynne, Rupert S.
Maitland, Sir Arthur D. Steel-
Shepperson, E. W.


Hacking, Captain Douglas H.
Makins, Brigadier-General E.
Shipwright, Captain D.


Hall, Rr-Adml Sir W. (Liv'p'l,W.D'by)
Malone, Major P. B. (Tottenham, S.)
Skelton, A. N.


Halstead, Major D.
Margesson, H. D. R.
Smith, Sir Allan M. (Croydon, South)


Hamilton, Sir George C. (Altrincham)
Mason, Lieut.-Col. C. K.
Somerville, A. A. (Windsor)


Hannon, Patrick Joseph Henry
Mercer, Colonel H.
Somerville, Daniel (Barrow-in-Furness)


Harvey, Major S. E.
Milne, J. S. Wardlaw
Spender-Clay, Lieut.-Colonel H. H.


Hawke, John Anthony
Mitchell, W. F. (Saffron Walden)
Stanley, Lord


Hay, Major T. W. (Norfolk, South)
Mitchell, Sir W. Lane (Streatham)
Steel, Major S. Strang


Henn, Sir Sydney H.
Morrison, Hugh (Wilts, Salisbury)
Stewart, Gershom (Wirral)


Hennessy, Major J. R. G.
Murchison, C. K.
Stott, Lt.-Col. W. H.


Herbert, Dennis (Hertford, Watford)
Nesbitt, Robert C.
Stuart, Lord C. Crichton-


Hewett, Sir J. P.
Newman, Colonel J. R. P. (Finchley)
Sueter, Rear-Admiral Murray Fraser


Hilder, Lieut.-Colonel Frank
Newman, Sir R. H. S. D. L. (Exeter)
Sugden, Sir Wilfrid H.


Hiley, Sir Ernest
Newson, Sir Percy Wilson
Sutherland, Rt. Hon. Sir William


Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Newton, Sir D. G. C. (Cambridge)
Sykes, Major-Gen. Sir Frederick H.


Hogg, Rt. Hon. Sir D. (St. Marylebone)
Nield, Sir Herbert
Thompson, Luke (Sunderland)


Holbrook, Sir Arthur Richard
O'Neill, Rt. Hon. Hugh
Thomson, F. C. (Aberdeen, S.)


Hood, Sir Joseph
Paget, T. G.
Thorpe, Captain John Henry


Hopkins, John W. W.
Parker, Owen (Kettering)
Titchfield, Marquess of


Hopkinson, A. (Lancaster, Mossley)
Pease, William Edwin
Tryon, Rt. Hon. George Clement


Howard, Capt. D. (Cumberland, N.)
Percy, Lord Eustace (Hastings)
Tubbs, S. W.


Hudson, Capt. A.
Perkins, Colonel E. K.
Turton, Edmund Russborough


Hughes, Collingwood
Perring, William George
Wallace, Captain E.


Hume, G. H.
Pilditch, Sir Philip
Ward, Col. L. (Kingston-upon-Hull)


Hunter-Weston, Lt.-Gen. Sir Aylmer
Pollock, Rt. Hon. Sir Ernest Murray
Watts, Dr. T. (Man., Withington)


Hurst, Lieut.-Colonel Gerald B.
Pownall, Lieut.-Colonel Assheton
Wells, S. R.


Hutchison, G. A. C. (Midlothian, N.)
Pretyman, Rt. Hon. Ernest G.
Weston, Colonel John Wakefield


Inskip, Sir Thomas Walker H.
Privett, F. J.
White, Lt.-Col. G. D. (Southport)


Jackson, Lieut.-Colonel Hon. F. S.
Raine, W.
Whitla, Sir William


James, Lieut.-Colonel Hon. Cuthbert
Rawlinson, Rt. Hon. John Fredk. Peel
Windsor-Clive, Lieut.-Colonel George


Jenkins, W. A. (Brecon and Radnor)
Remer, J. R.
Winterton, Earl


Jephcott, A. R.
Remnant, Sir James
Wise, Frederick


Jodrell, Sir Neville Paul
Rentoul, G. S.
Wolmer, Viscount


Johnson, Sir L. (Walthamstow, E.)
Rhodes, Lieut-Col. J. P.
Wood, Rt. Hn. Edward F. L. (Ripon)


Jones, G. W. H. (Stoke Newington)
Richardson, Sir Alex. (Gravesend)
Woodcock, Colonel H. C.


Joynson-Hicks, Sir William
Richardson, Lt.-Col. Sir P. (Chertsey)
Worthington-Evans, Rt. Hon. Sir L.


Kennedy, Captain M. S. Nigel
Roberts, Samuel (Hereford, Hereford)
Yate, Colonel Sir Charles Edward


King Captain Henry Douglas
Robertson-Despencer, Major (Islgtn, W.)
Yerburgh, R. D. T.


Kinloch-Cooke, Sir Clement
Rothschild, Lionel de



Lamb, J. Q.
Roundell, Colonel R. F.
TELLERS FOR THE NOES.—


Lane-Fox, Lieut.-Colonel G. R.
Ruggles-Brise, Major E.
Colonel Leslie Wilson and Colonel


Lloyd, Cyril E. (Dudley)
Russell, William (Bolton)
Gibbs.

NEW CLAUSE.—(Assessment of weekly wage-earners.)

Rule 2 of the Rules applicable to Cases I and II of Schedule D (which relates to the assessment and charge of weekly wage-earners) shall have effect as though after the word "quarter," where that word secondly occurs, there were inserted the words "less any cost of travelling to and from their place of employment."—[Mr. T. Williams.]

Brought up, and read the First time.

Mr. T. WILLIAMS: I beg to move, "That the Clause be read a Second time."
During the War an allowance was made to meet expenses incurred in travelling to and from work, and it seems to me the right hon. Gentleman ought to use the Cabinet Minister's great influence to see that this concession is forthcoming. I can give many typical examples of men having to live in a town because there happens to be no housing accommodation near the colliery they work at, and they
have perforce to pay travelling expenses, to and fro. We have cases where miners are compelled through no fault of their own to travel distances varying from four to 20 miles per day, and the cost is sometimes as high as 8s. per week. In many instances workmen are called upon to pay increases up to 150 per cent. over and above what they had to pay prior to the War. At this moment, with wages so low, there ought to be no indirect reduction because men cannot secure housing accommodation near their work. One only needs to remind hon. Members of the Housing Bill to realize that men cannot live where they like. The housing shortage is a reply in itself to any submission that could be made that men should live nearer to their work. They cannot live near their work because housing accommodation is not available. We have the contradiction that where an
employer is good enough to contribute towards the travelling expenses of his workmen, a rebate is made for that amount since it happens to be allowed in the expenses of his industry, but the proportion that the man is compelled to pay is liable to Income Tax; therefore, if only from that point of view it seems to me that this concession ought to be granted and the Government ought not to be seeking further to reduce the very meagre incomes of a large number of people. When this Clause was moved last year the Solicitor-General referred to the case of a solicitor who might be travelling all over the country, and to a director who might be a director of many firms. This new Clause only applies to workmen whose Income Tax is calculated on a quarterly basis, so the point of the solicitor and the question of the director's fes do not enter into the argument at all.
The present Solicitor-General, who was a private Member last year, suggested that wherever workpeople were called upon to pay travelling expenses they ought not to seek a rebate from Income Tax, but they ought to call upon their employers to increases wages. We should welcome any assistance the right hon. Gentleman can give us in that direction, but, having had some little experience of attempting to persuade employers to do this, we recognise the futility of that argument. Moreover, the Government, which should set the example to employers, are not prepared to accept the right hon. Gentleman's own philosophy. On 19th June the hon. Member for Woolwich (Sir K. Wood) asked a question about 75 men who had been transferred from Woolwich to Pimlico and had to pay 7s. 6d. per week out of their wages for travelling expenses, and he asked the Minister to make up the expenses they were put to. The hon. Gentleman in charge of the Department said in reply:
I am aware of the circumstances. I regret that I cannot accept the principle that wages should be increased on account of the distances travelled by the employés concerned."—[OFFICTAL REPORT, 19th June, 1923; col. 1175, Vol, 165.]
To that there is little or no hope of persuading employers to meet these travelling expenses since the Government themselves refuse to meet the expenses of their employés. They are not only losers to the extent of the travelling expenses, but they are actually called upon later
in the year to pay Income Tax on money they have never received except that they have merely received it to hand it over to the railway company. Another excuse submitted last year was that to grant this concession would be to place the workers in a privileged position. That argument is simply ridiculous. Instead of placing the workers in a privileged position, obviously it would remove a real grievance, because the expense to which the workmen are put in going to and from their work is a reduction in wages. If we examine the case of various individuals in professional spheres we shall find that, although all expenses are not exempt from Income Tax, a very large proportion of them are. I know of managers of collieries who have motor-cars purchased for the purpose of conveying them from point to point. I do not object to that because, in many instances, it is necessary, but the purchase of the motor-car is part of the expenses of that particular industry, and the wages of the individual who drives the car come from the colliery office, and are tabulated as expenses. The petrol, upkeep, and all sorts of things that go towards making it possible for the manager to move from point to point are calculated by the colliery company as expenses, and incidentally they become exempt from Income Tax.
Consequently, from the point of view of equity, the right hon. Gentleman ought to make this concession. When we talk about no preference in Income Tax, we are reminded that in the present Bill a person with an income of £500 a year, with an average family of three children, is granted a rebate, by the reduction in Income Tax, of £1 13s. 4d., while a person with £150,000 income is given a concession of £3,734. From the point of view of equity and of removing a real grievance, this concession should be granted. It may not seem a great deal, but for the person who is merely able to carry on 30s. a year is a very large sum, and if he wished to buy a pair of boots it would enable him to do so. The concession would remove a grievance under which many people are suffering. As they are taxed upon nearly everything they eat and drink, and almost on the air they breathe, it should be granted, especially to those who have to travel miles to their work, because private enterprise or some
thing else has refused to provide adequate accommodation in their own parish.

Mr. GEORGE SPENCER: I beg to second the Motion. There is a double hardship on most men who have to travel to work, because in pre-War days the workman who used to pay 1s. has now to pay 3s. a week. That is to say, where he formerly paid £2 10s. in pre-War days, he would now pay, for the same journey, £7 10s. a year. That means an additional expense of £5 a year, and for bearing that with a degree of quietness, the Government comes along and says, "If you are a single man, earning more than £135 a year, you will have to pay me 11s. 3d. on that £5. If you are a married man, earning more than £250, you will have to pay the same sum if you have no children." The workman has not only to pay on the £5, but he has to pay additional taxation. Last year there was a rebate, and I cannot see what the Government has got out of the imposition of this tax, except a great deal more of dissatisfaction and unrest amongst the working people than existed before. There is a grievance amongst the workmen who cannot get a house near their work, and I hope, if possible, the Government will grant this concession.

Sir W. JOYNSON-HICKS: This question, like so many others which have been discussed many times in this House, really results from the decision of the Exchequer last year not to continue the War exemption. There was a War exemption for the expenses of workmen going to and from their work, and I think there was quite reasonable ground for giving it. When the War was over, however, and things got more settled, the late Chancellor of the Exchequer, the right hon. Member for Hillhead (Sir R. Horne), came to the conclusion that it was no longer desirable to make this inroad on the general principle of the Income Tax law, and he brought the exemption to an end. I think, on general principles, he was right.

Mr. SPENCER: He was only premature, insomuch as the railway companies had not got the fares.

Sir W. JOYNSON-HICKS: Of course, there is something to be said from the point of view of the wages of the railway
Workers, but I am quite sure the hon. Member would not like to take them into consideration in regard to the question of the high fares at all. There is, in principle, no reason why this concession should be made to workmen, rather than to the middle classes—to the clerks and small employers who have to travel in the same way. If you give it to one, you must give it to all, and the hon. Gentleman is perfectly fair and candid in the matter. He sees where it would go. An Amendment was put down to this effect on the Committee stage, and we felt it impossible to accept it. The hon. Member who moved the Amendment was quite fair in giving us the figure of the workmen's wages. Take the average case of a workman, with a wife and three children—a normal family. No working man is taxed unless he has an income of £315 a year under those circumstances, and that means a regular income of £6 a week. The hon. Member referred to the miners, but from what one hears to-day about miners' wages, it makes one think—

Mr. WILLIAMS: They are not all married with three children.

Sir W. JOYNSON-HICKS: I agree, but they are the people with whom one has sympathy. After all, the unmarried man, with an income of £2 10s. or £3 a week, is not really the man who ought to come to this House for concessions. If you consider the average married man, with a wife and three children, he would not be taxed on his travelling expenses unless his income were over £6 a week, and if he has an income of, say, £8 a week in weekly wages, which is fairly high, he would still only be taxed on £2 a week, because he would get a previous exemption for his wife and children, and so on. Under those circumstances, I do not think there is a real grievance. The grievance put by the hon. Gentleman who moved the Amendment was that the workman should not be compelled to pay his own fare, but that it should be paid by the employer. That is quite a different position, and I am not here to express an opinion, one way or the other.

Mr. WILLIAMS: I suggested that the present Solicitor-General submitted that argument last year, but now the Government, of which he is a Member, will not carry out his suggestion.

Sir W. JOYNSON-HICKS: I must confess that the real position we are discussing under the Amendment, of a weekly expenditure amounting, as I think the Seconder of the Amendment said, to £5 a year, and involving a tax of 11s. 3d., would not fall heavily on the average weekly wage-earner. That is to say, if a married man, whose wages are £6 a week, had to pay 11s. 3d. in tax, it would not be a very great sum for him to contribute towards the taxation of the

country. That is the real principle, and though it is very difficult for one in my position to keep on saying "No, no" in these cases, the taxes have got to come in, and the Government of the country must be carried on. Therefore it is impossible for me to make this concession.

Question put, "That the Clause be read a Second time."

The House divided: Ayes, 147; Noes, 227.

Division No. 260.]
AYES.
[7.57 p.m.


Alexander, A. V. (Sheffield, Hillsbro')
Hastings, Patrick
Ponsonby, Arthur


Attlee, C. R.
Hay, Captain J. P. (Cathcart)
Potts, John S.


Barker, G. (Monmouth, Abertillery)
Hayday, Arthur
Pringle, W. M. R.


Barrie, Sir Charles Coupar (Banff)
Hayes, John Henry (Edge Hill)
Rees, Sir Beddoe


Batey, Joseph
Henderson, Rt. Hon. A. (N'castle, E.)
Riley, Ben


Bonwick, A.
Herriotts, J.
Ritson, J.


Bowerman, Rt. Hon. Charles W.
Hill, A.
Roberts, C. H. (Derby)


Broad, F. A.
Hillary, A E.
Roberts, Frederick O. (W. Bromwich


Brotherton, J.
Hinds, John
Rovce, William Stapleton


Brown, James (Ayr and Bute)
Hirst, G. H.
Saklatvala, S.


Buckie, J.
Hodge, Rt. Hon. John
Salter, Dr. A.


Burgess, S.
Hutchison, Sir R. (Kirkcaldy)
Scrymgeour, E.


Burnie, Major J. (Bootle)
Irving, Dan
Sexton, James


Buxton, Charles (Accrington)
Jenkins, W. (Glamorgan, Neath)
Shakespeare, G. H.


Buxton, Noel (Norfolk, North)
John, William (Rhondda, West)
Shaw, Hon. Alex. (Kilmarnock)


Chapple, W. A.
Johnston, Thomas (Stirling)
Shaw, Thomas (Preston)


Clarke, Sir E. C.
Jones, Henry Haydn (Merioneth)
Shinwell, Emanuel


Collins, Sir Godfrey (Greenock)
Jones, J. J. (West Ham, Silvertown)
Short, Alfred (Wednesbury)


Collins, Pat (Walsall)
Jones, R. T. (Carnarvon)
Simon, Rt. Hon. Sir John


Cotts, Sir William Dingwall Mitchell
Jones, T. I. Mardy (Pontypridd)
Snell, Harry


Darbishire, C. W.
Jowett, F. W. (Bradford, East)
Snowden, Philip


Davies, Alfred Thomas (Lincoln)
Jowitt, W. A. (The Hartlepools)
Spencer, George A. (Broxtowe)


Davies, Evan (Ebbw Vale)
Kenyon, Barnet
Stephenson, Lieut.-Colonel H. K.


Davies, J. C. (Denbigh, Denbigh)
Lansbury, George
Stewart, J. (St. Rollox)


Davies, Rhys John (Westhoughton)
Lawson, John James
Sutherland, Rt. Hon. Sir William


Davison, J. E. (Smethwick)
Leach, W.
Thomas, Sir Robert John (Anglesey)


Dudgeon, Major C. R.
Lee, F.
Thomson, T. (Middlesbrough, West)


Duffy, T. Gavan
Lees-Smith, H. B. (Keighley)
Thorne, W. (West Ham, Plaistow)


Dunnico, H.
Linfield, F. C.
Thornton, M.


Ede, James Chuter
Lowth, T.
Trevelyan, C. P.


Edge, Captain Sir William
Lunn, William
Turner, Ben


Edmonds, G.
MacDonald, J. R. (Aberavon)
Wallhead, Richard C.


Edwards, C. (Monmouth, Bedwellty)
M'Entee, V. L.
Walsh, Stephen (Lancaster, Ince)


Entwistle, Major C. F.
McLaren, Andrew
Watson, W. M. (Dunfermline)


Falconer, J.
Macnamara, Rt. Hon. Dr. T. J.
Watts-Morgan, Lt.-Col. D. (Rhondda)


Foot, Isaac
March, S.
Wedgwood, Colonel Josiah C.


Gilbert, James Daniel
Marshall, Sir Arthur H.
Westwood, J.


Gosling, Harry
Martin, F. (Aberd'n & Kinc'dine, E.)
White, Charles F. (Derby, Western)


Graham, W. (Edinburgh, Central)
Middleton, G.
Whiteley, W.


Greenall, T.
Mond, Rt. Hon. Sir Alfred Moritz
Williams, David (Swansea, E.)


Greenwood, A. (Nelson and Colne)
Morel, E. D.
Williams, Dr. J. H. (Llanelly)


Grenfell, D. R. (Glamorgan)
Morrison, R. C. (Tottenham, N.)
Williams, T. (York, Don Valley)


Griffiths, T. (Monmouth, Pontypool)
Mosley, Oswald
Wilson, C. H. (Sheffield, Attercliffe)


Groves, T.
Murray, John (Leeds, West)
Wintrinqham, Margaret


Grundy, T. W.
O'Grady, Captain James
Wood, Major M. M. (Aberdeen, C.)


Hall, F. (York, W.R., Normanton)
Oliver, George Harold
Wright, W.


Hamilton, Sir R. (Orkney & Shetland)
Paling, W.
Young, Robert (Lancaster, Newton)


Hardie, George D.
Parry, Lieut.-Colonel Thomas Henry



Harney, E. A.
Pattinson, S. (Horncastle)
TELLERS FOR THE AYES.—


Harris, Percy A.
Phillipps, Vivian
Mr. Ammon and Mr. Morgan




Jones.


NOES.


Agg-Gardner, Sir James Tynte
Bell, Lieut.-Col. W. C. H. (Devizes)
Brass, Captain W.


Alexander, E. E. (Leyton, East)
Bellairs, Commander Carlyon W.
Bridgeman, Rt. Hon. William Clive


Alexander, Col. M. (Southwark)
Benn, Sir A. S. (Plymouth, Drake)
Brown, Major D. C. (Hexham)


Archer-Shee, Lieut.-Colonel Martin
Bennett, Sir T. J. (Sevenoaks)
Brown, Brig.-Gen. Clifton (Newbury)


Ashley, Lt.-Col. Wilfrid W.
Berry, Sir George
Bruton, Sir James


Baldwin, Rt. Hon. Stanley
Betterton, Henry B.
Buckingham, Sir H.


Balfour, George (Hampstead)
Birchall, Major J. Dearman
Burn, Colonel Sir Charles Rosdew


Banks, Mitchell
Bird, Sir William B. M. (Chichester)
Burney, Com. (Middx., Uxbridge)


Barnett, Major Richard W.
Blades, Sir George Rowland
Butler, H. M. (Leeds, North)


Barnston, Major Harry
Bowyer, Capt. G. E. W.
Butt, Sir Alfred


Becker, Harry
Boyd-Carpenter, Major A.
Button, H. S.


Cadogan, Major Edward
Harrison, F. C.
Pilditch, Sir Philip


Campion, Lieut.-Colonel W. B.
Harvey, Major S. E.
Pollock, Rt. Hon. Sir Ernest Murray


Cautley, Henry Strother
Hawke, John Anthony
Pownall, Lieut.-Colonel Assheton


Cayzer, Sir C. (Chester, City)
Hay, Major T. W. (Norfolk, South)
Privett, F. J.


Cecil, Rt. Hon. Sir Evelyn (Aston)
Hennessy, Major J. R. G.
Rae, Sir Henry N.


Cecil, Rt. Hon. Lord H. (Ox. Univ.)
Herbert, Dennis (Hertford, Watford)
Raine, W.


Chadwick, Sir Robert Burton
Hewett, Sir J. P.
Rawlinson, Rt. Hon. John Fredk. Peel


Chamberlain, Rt. Hn. J. A. (Birm., W.)
Hilder, Lieut.-Colonel Frank
Remer, J. R.


Chamberlain, Rt. Hon. N. (Ladywood)
Hiley, Sir Ernest
Remnant, Sir James


Churchman, Sir Arthur
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Rentoul, G. S.


Clarry, Reginald George
Hogg, Rt. Hon. Sir D. (St. Marylebone)
Rhodes, Lieut.-Col. J. P.


Clayton, G. C.
Hohler, Gerald Fitzroy
Richardson, Sir Alex. (Gravesend)


Cobb, Sir Cyril
Holbrook, Sir Arthur Richard
Richardson, Lt.-Col. Sir P. (Chertsey)


Cockerill, Brigadier-General G. K.
Hood, Sir Joseph
Roberts, Samuel (Hereford, Hereford)


Cohen, Major J. Brunel
Hopkins John W. W.
Robertson-Despencer, Major (Islgtn, W.)


Colfox, Major Wm. Phillips
Hopkinson, A. (Lancaster, Mossley)
Rothschild, Lionel de


Colvin, Brig-General Richard Beale
Houfton, John Plowright
Roundell, Colonel R. F.


Conway, Sir W. Martin
Hudson, Capt. A.
Ruggles-Brise, Major E.


Cope, Major William
Hughes, Collingwood
Russell, William (Bolton)


Craig, Captain C. C. (Antrim, South)
Hume, G. H.
Russell-Wells, Sir Sydney


Craik, Rt. Hon. Sir Henry
Hunter-Weston, Lt.-Gen. Sir Aylmer
Samuel, A. M. (Surrey, Farnham)


Croft, Lieut.-Colonel Henry Page
Hurst, Lieut.-Colonel Gerald B.
Samuel, Samuel (W'dsworth, Putney)


Crook, C. W. (East Ham, North)
Hutchison, G. A. C. (Midlothian, N.)
Sanderson, Sir Frank B.


Crooke, J. Smedley (Deritend)
Inskip, Sir Thomas Walker H.
Sandon, Lord


Dalziel, Sir D. (Lambeth, Brixton)
Jackson, Lieut.-Colonel Hon. F. S.
Sheffield, Sir Berkeley


Davidson, J. C. C. (Hemel Hempstead)
James, Lieut.-Colonel Hon. Cuthbert
Shepperson, E. W.


Davidson, Major-General Sir J. H.
Jenkins, W. A. (Brecon and Radnor)
Shipwright, Captain D.


Davison, Sir W H. (Kensington, S.)
Jephcott, A. R.
Skelton, A. N.


Dawson, Sir Philip
Jodrell, Sir Neville Paul
Smith, Sir Allan M. (Croydon, South)


Dixon, C. H. (Rutland)
Johnson, Sir L. (Walthamstow, E.)
Smith, Sir Harold (Wavertree)


Doyle, N. Grattan
Jones, G. W. H. (Stoke Newington)
Somerville, A. A. (Windsor)


Du Pre, Colonel William Baring
Joynson-Hicks, Sir William
Somerville, Daniel (Barrow-in-Furn'ss)


Edmondson, Major A. J.
Kennedy, Captain M. S. Nigel
Spender-Clay, Lieut.-Colonel H. H.


Ednam, Viscount
King, Captain Henry Douglas
Stanley, Lord


Elliot, Capt. Walter E. (Lanark)
Lamb, J. Q.
Steel, Major S. Strang


Ellis, R. G.
Lane-Fox, Lieut.-Colonel G. R.
Stewart, Gershom (Wirral)


Erskine, Lord (Weston-super-Mare)
Locker-Lampson, Com. O. (Handsw'th)
Stott, Lt.-Col. W. H.


Erskine-Bolst, Captain C.
Lorden, John William
Stuart, Lord C. Crichton-


Eyres-Monsell, Com. Bolton M.
Lorimer, H. D.
Sueter, Rear-Admiral Murray Fraser


Falcon, Captain Michael
Loyd, Arthur Thomas (Abingdon)
Sugden, Sir Wilfrid H.


Falle, Major Sir Bertram Godfray
Macnaghten, Hon. Sir Malcolm
Sykes, Major-Gen. Sir Frederick H.


Fawkes, Major F. H.
McNeill, Ronald (Kent, Canterbury)
Thompson, Luke (Sunderland)


Flanagan, W. H.
Makins, Brigadier-General E.
Thomson, F. C. (Aberdeen, S.)


Ford, Patrick Johnston
Malone, Major P. B. (Tottenham, S.)
Titchfield, Marquess of


Foreman Sir Henry
Margesson, H. D. R.
Tryon, Rt. Hon. George Clement


Forestier-Walker, L.
Mason, Lieut.-Col. C. K.
Tubbs, S. W.


Fremantle, Lieut.-Colonel Francis E.
Mercer, Colonel H.
Turton, Edmund Russborough


Furness, G. J.
Milne, J. S. Wardlaw
Wallace, Captain E.


Galbraith, J. F. W.
Mitchell, W. F. (Saffron Walden)
Ward, Col. L. (Kingston-upon-Hull)


Ganzoni, Sir John
Mitchell, Sir W. Lane (Streatham)
Watts, Dr. T. (Man., Withington)


Gardiner, James
Moore-Brabazon, Lieut.-Col. J. T. C.
Wells, S. R.


Garland, C. S.
Moreing, Captain Algernon H.
Weston, Colonel John Wakefield


Gates, Percy
Murchison, C. K.
White, Lt.-Col. G. D. (Southport)


Gaunt, Rear-Admiral Sir Guy R.
Nesbitt, Robert C.
Whitla, Sir William


Gilmour, Lt.-Col. Rt. Hon. Sir John
Newman, Colonel J. R. P. (Finchley)
Windsor-Clive, Lieut.-Colonel George


Goff, Sir R. Park
Newman, Sir R. H. S. D. L. (Exeter)
Winterton, Earl


Gould, James C.
Newson, Sir Percy Wilson
Wise, Frederick


Greene, Lt.-Col. Sir W. (Hack'y, N.)
Newton, Sir D. G C (Cambridge)
Wolmer, Viscount


Grenfell, Edward C. (City of London)
Nield, Sir Herbert
Wood, Rt. Hn. Edward F. L. (Ripon)


Guinness, Lieut.-Col. Hon. W. E.
O'Neill, Rt. Hon. Hugh
Woodcock, Colonel H. C.


Gwynne, Rupert S.
Paget, T. G.
Yate, Colonel Sir Charles Edward


Hacking, Captain Douglas H.
Parker, Owen (Kettering)
Yerburgh, R. D. T.


Hall, Rr-Adml Sir W. (Liv'p'l,W.D'by)
Pease, William Edwin



Halstead, Major D.
Pennefather, De Fonblanque
TELLERS FOR THE NOES.—


Hamilton, Sir George C. (Altrincham)
Perkins, Colonel E. K.
Colonel Leslie Wilson and Colonel


Hannon, Patrick Joseph Henry
Perring, William George
Gibbs.

NEW CLAUSE.—(Exemption of income of person casually employed.)

Notwithstanding anything in the Income Tax Acts, the income of a wage-earner who is casually employed by the hour or less period and who is not in the regular employment of one exployer shall be exempt from Income Tax.—[Mr. Sexton.]

Brought up, and read the First time.

Mr. SEXTON: I beg to move, "That the Clause be read a Second time."
This is not the first time that I have presented this Clause to the House. I brought it to the notice of two predecessors of the right hon. Gentleman the Financial Secretary to the Treasury. It deals with the hardships of the casual labourer under the present system of taxation. I hope the House will excuse me if I have to repeat myself in order to bring forward my argument. My only excuse for doing so is that the custom of the House is for the bulk of the Members
to absent themselves from the arguments brought forward, and the only guide for them in the Division Lobby is the presence of the Tellers of the party that represents them. In the hope that the right hon. Gentleman was absent from the last Debate on this subject, and I think he was, I find my excuse for repeating the argument. The case I have to put forward is that the casual labourer employed by more than one employer is in a very awkward position with respect to the payment of Income Tax. He is assessed quarterly, and the first quarter may be a lean one. He may have four or five employers in the course of one week, and I will give a typical case to the right hon. Gentleman before I sit down. The second quarter may be a fat quarter with lean streaks. The assessment for the first quarter has to be paid in the second quarter, and that for the second quarter has to be paid in the third quarter, which is a lean one. Owing to the fact of the first quarter being a lean one, he is in debt to the tommy shop, which uses up all his money in the second quarter, and when the demand comes in the third quarter he has no money to pay. Being illiterate he lets the thing go by default. These men know nothing about Income Tax forms. They think that is a lawyer's job, and they do not understand it. The man gets a summons; he goes to Court or he does not go to Court, and the case goes against him.
I heard the right hon. Gentleman say the other night, in resisting certain Amendments, that there would be a loss of revenue. He is losing revenue in this case, because it is costing him more to collect the casual labourer's Income Tax than he gets out of it. I can give him the case of a man with a family of five who was not exempted from Income Tax, but who just came within the limit to the extent of probably £3. He got his summons, he stated his case himself, because he had no solicitor, and the case went against him. He could not pay; and he went to gaol for a fortnight. It cost the Government 30s. a week to keep that man in gaol a fortnight, which is £3. The wife and the two children whose income was assessed because the wife went out charing and the children were selling matches or papers, went to the workhouse, and it cost the State £2 a week to keep them there. When the man was released
from prison the workhouse authorities put the wife and children into a taxicab, the only luxury they ever had in their lives, and brought them to the man and told him to find a home for them. I do not know what it cost to secure that £3 of Income Tax, if they ever got it. The right hon. Gentleman is spending the money of the Government in the hope of getting something which he really never gets. Take the cost of collection. Take the case of a man who has four employers in the course of one week. It may be one employer employs him in the morning, and another employs him in the afternoon. Look at the enormous cost it means to the employers to make returns. Look at the work it means to the Clerk of Customs in order to get at the facts accurately.
I have been told, "Oh, but a man has a remedy. If he overpays at the end of the year he can have a rebate." The right hon. Gentleman, however, seems to forget that the man has to pay the money before he gets a rebate, and he has not got the money to pay, and the only rebate he gets is gaol. I could give the right hon. Gentleman more than one case, but I think I have in principle given him enough. He says the taxes have to come in, but these taxes do not come in. That is just my point. Therefore, I would ask the right hon. Gentleman to see the reasonableness of the case I have to make. I could give a case where a man made a few pounds during a quarter. His children were trading on the streets, selling newspapers or matches, and that was counted in, and the wife's charing was counted in, and all this living from hand to mouth is counted in, and he has to pay Income Tax, and if he goes to gaol his tax is not wiped out. When the man comes out, a warrant, like the sword of Damocles, is hanging over his head all the time. The tendency on the part of that man, who feels like a fugitive from justice, will be not to seek work, because if he goes to work the law will be after him to grab his wages. I have often heard that the law is an ass, but if it ever is an ass it is so in connection with this tax on the casual labourer, because it imposes a tax that it never gets. I hope the right hon. Gentleman will at least see that this assessment, if it be not altogether abolished, will be so
arranged that the man will have a chance at the end of the year to prove that he has not earned the income for the year on which he is assessed. It is a small concession to ask, and if he will promise me that, I shall not press my Amendment to a Division, but if he does not, I shall.

Mr. J. JONES: I beg to second the Motion. The facts given by my hon. Friend the Member for St. Helen's (Mr. Sexton) justify me in seconding this new Clause. All of us who represent riverside constituencies, largely occupied by casual labourers, have experience of cases of very great hardship inflicted on this class of men. I know of men, in my constituency, who have gone to prison because they have not paid Income Tax, yet at the very time, when they were sent to prison, they were out of work and on unemployment benefit. It seems extraordinary that a casual labourer should have his tax assessed upon three months' earnings when all other classes of taxpayers are assessed upon the whole 12 months. Why should the casual labourer, the most unfortunate member of the community, speaking generally, be differentiated against in this way? We in West Ham have actually had to keep the wives and children of men who have gone to prison because they have not paid on a successful quarter's earnings. This tax was introduced during the War, when everybody was expected to do their bit, financially and otherwise, and the consequences were that men in regular employment, doing well at that time, were in a position to pay, but now, what happens? In my own constituency, we have men who are working in seasonal trades. Down at the docks there are certain periods when certain trades are busy, and the result of the operation of this assessment is, that while a particular section may be busy for three months, they are slack for the other nine months, yet on the good period they are assessed over and above their means to pay, and when the tax collector comes, he generally comes when they are slack. The consequence is, that these men, not being able to pay, have to go.
I do not think any other section of the taxpayers of the country are so badly treated as are these men. If you are going to tax these men, tax them on the
same basis as you tax other taxpayers. Give them the same length of time, and take the whole period, and I suggest that if you do that with a casual labourer, you will find that he will not come under the tax at all. You have plenty of chance of getting his earnings in a year. Any shipping company at the docks will tell them, and your inspectors have to find out, by interviewing the companies' officials, what the men earn. Therefore, I say that under present conditions, with reductions in wages taking place automatically, when we are threatened every day with reductions in wages, because a man has a good run of work, because for six or seven weeks in one quarter he may be working night and day, it is not fair to tax him on that period. This is another point. These men are not ordinary employés, working normal working hours. They have to work shifts, they have to work continuous work, they have to work whenever they are required to get a ship clear, and instead of working, as ordinary people do, so many hours a day, they have to work night and day until a job is finished. Surely it is not fair, therefore, because these men have to put forward extraordinary efforts to earn an extra shilling or two, because they happen to be extremely busy in a particular period, that that period should count as their average income, and the rest of the period, when they are out of work, should not count in their favour.
We are in favour of taxation on the ground of the ability of the people to pay, but we object to this differentiation. It was introduced when there was a circumstance in its favour. We knew, of course, that when millions of young men went out to the War, and were compelled by circumstances to leave their employment, there was a certain amount of extra employment created for certain classes of workers, particularly in the transport industries, and, as a consequence of those men having to go away, the men left had to work night and day, and were able to earn decent money. We all admit that, but the situation has completely changed now, and we have come back to less than the normal. In my own constituency, the average docker is not doing two days a week, but at certain periods he is earning more than the normal, and the consequences are that he is then liable to Income Tax. It is absolutely unfair to tax that man because for three months
in the year he is doing well, on account of the seasonal nature of his occupation, but that he should have no allowance made for the nine months when he hangs about the dock gates not knowing when he is going to get a day's work. I hope the right hon. Gentleman will see his way to accept the Amendment.

Mr. LANSBURY: I want to join with my two hon. Friends in asking that the casual labourer, whom, I think, my hon. Friend the Member for Silvertown (Mr. J. Jones) and my hon. Friend the Member for South Poplar (Mr. March) represent in this House to a very large extent, should be exempt from Income Tax. Experience proves to us without a shadow of doubt that neither the nation nor the local authorities gain anything by attempting to collect this money. The major part of the casual labourers who come under the Income Tax law are not a class of men whom, in normal circumstances, it would be right to tax at all. I defy any hon. Member opposite, and if their wives were here I would defy them too, to be thrifty and careful and saving when you do not know from one week to another what your income is going to be. There is nothing so demoralising as casual labour, and I would have thought that, now the War is over, there would be no hesitancy at all on the part of the Government in reverting to the old practice of leaving these men out. It is all very well to say that during the flush period they should save money, but there are many things to make up for that they have not had, and there is the fear of what is going to happen the next month or the next week. I do not believe hon. Members of this House, unless they have come in contact with it as social workers or as representing a district where such men are employed, realise the deadening effect of not knowing how much their income is going to be, and how it takes away from them all idea of foresight, and laying up, and so on.
As to sending them to prison, that is the most useless thing I have ever heard of. I do not want the House to think that I am continually reminding them of my own temporary sojourn in prison, but, quite honestly—and my hon. Friend the Member for South Poplar will bear me out—with the major part of the men whom we met in Brixton Prison we had a joke
amongst ourselves, that we were all there for debt, and the debt really was debt to the Income Tax Commissioners. You never got the money, and, unhappily, in places like Canning Town and Poplar the local ratepayers were having to keep the wives and children of the men who were in prison. That is really an absurd method of trying to get taxes, and I would appeal to the right hon. Gentleman in charge of the Bill whether he will not agree to give this matter some reconsideration with his experts, and, if our Clause be not the right sort of Clause to meet the case, bring up another, so that the matter may be settled for good and for all. These men are, in my judgment, the victims of an evil system, which ought long ago to have been abolished, but, until its abolition, for goodness sake do not let us penalise them further by imposing this burden, which is a burden and yet not a burden. I mean that you impose it on them, but they are not able to pay, and you really put the additional burden on the community. I think it is time that that was done away with, and if the right hon. Gentleman will consider it. I think he will see that we have made a perfectly reasonable proposal.

Sir W. JOYNSON-HICKS: I am somewhat in a difficulty, as I am impressed by the three hon. Members who have spoken, but I do not think they quite realise that these men to whom they have been referring—and the hon. Member for St. Helen's (Mr. Sexton) mentioned the case of a man with a wife and three children—are not liable at all unless they are earning over £6 a week. I understand, from the hon. Member for Bow and Bromley (Mr. Lansbury) that wages, unfortunately, are going down in his district, and possibly those men may no longer be liable to the tax, but, if they are earning over £6, really they ought to contribute something, some small share, to the cost of running the country. I also ought to say, as it has not been mentioned, that there is a provision for these small quarterly Income Tax payments to be made by weekly stamps, on a form which the collector will provide for them, so that it is not altogether quite as hard a case as has been put to me. Further, the difficulty does not arise unless it happens that the first quarter of the Income Tax year, from April to June, is a busy
quarter. If, for instance, that quarter is a slack quarter, and the income is below that of the second quarter which is a good one, then the second good quarter is averaged with the previous bad one, so that a real difficulty can only arise where the first quarter of the Income Tax year is a big one. If the first or second quarter had been slack, and the third quarter had been big, there would be no difficulty in averaging it over the one or two previous bad quarters.

Mr. SEXTON: Does not the right hon. Gentleman recognise that if there was a bad quarter and debts were incurred they would more than swallow the amount in the next quarter? The man has got to pay his debts.

Sir W. JOYNSON-HICKS: But Income Tax is a debt also, just as his debts for his groceries.

Mr. SEXTON: He does not eat Income Tax.

Sir W. JOYNSON-HICKS: When you are dealing with these matters on a just basis the tax is a debt. But I wanted to see whether there is any injustice which may be remedied. I agree that there is a hardship if the first quarter is a good one and the second and third quarters are bad. I agree that it is no answer to say that the casual worker, who has paid his Income Tax on the first good quarter, and then has had two bad quarters, can get it back. Hon. Members will agree that it can be got back, but there is a hardship there. I will go into the matter and see whether it is possible to meet the point. Nobody should be taxed unless he is liable to pay, unless he has earned during the whole year, in the case of a married man with three children, more than £315 per year. But the hon. Member will realise that we must not let off the casual labourer merely because he is a casual labourer, if he is earning a big enough income to warrant him paying. This is the last stage of this Bill, but I will go into the matter with my advisers and see whether anything can be done to remedy by administrative action the case which has been put forward of the man whose income in the first quarter of the year is large, and whose income falls off then in succeeding quarters so as to reduce the total amount calculated for the year. I do not suppose that the
amount involved is very heavy, particularly in view of the way in which wages, unfortunately, have fallen, but I will go into the question, and perhaps my hon. Friend will meet me and discuss it with me.

Motion and Clause, by leave, withdrawn

NEW CLAUSE.—(Bequests to hospitals.)

Legacy and succession duty shall not be leviable on testamentary bequests made to hospitals carried on in the public interest.—[Captain Viscount Ednam.]

Brought up, and read the First time.

Captain Viscount EDNAM: I beg to move, "That the Clause be read a Second time."
This Clause was moved on the Committee stage of the Bill but, owing to the lateness of the hour at which it was reached, and the nature of the agreement arrived at as to the limitations of the discussion on that stage, I had not time to go fully into the case. Therefore on that occasion I contented myself with formally moving the Clause and asking the Financial Secretary to the Treasury to receive a deputation representative of the hospitals before the Report stage. Last week the deputation went to the Treasury headed by Lord Hambleden and Sir Arthur Stanley, representing the British Hospitals Association, and Lord Stewart of Wortley, representing the King Edward Hospital Fund, and they and other representatives of the hospitals stated fully the case of the hospitals, which is a very strong one. When this Clause was moved in the Committee Stage the right hon. Gentleman had the opportunity of seeing that there was a considerable body of opinion on both sides of the House, which believed that this was a reasonable and just concession.
In stating my case I shall have to go briefly into the reasons which make the concession necessary. Before the War the financial position of the voluntary hospitals was, on the whole, with the exception of some temporary difficulties, a sound one. They were able to meet their expenditure out of receipts, and even, in some cases, able to put aside a surplus to build up a capital on which they could rely for a certain amount of income, or which could be utilised for extensions if necessary, or to provide against unforeseen liabilities. Then came the War, and
with it an increase in the cost of all provisions, fuel, drugs, surgical apparatus, salaries and wages, but without any corresponding increase in receipts. At the end of the War the financial position of the hospitals went from bad to worse, and the withdrawal of grants in respect of service pensions and pensioners completed their downfall. While ordinary hospital income has increased since 1913 by 67 per cent., ordinary expenditure has increased by 137 per cent., besides which, at the end of the War hospitals were faced with the added difficulty of having to carry out urgent repairs which had necessarily been postponed owing to the War. That was the position in 1920. Practically every hospital in the country showed a deficit on its books for the year. The total indebtedness of the hospitals of Great Britain amounted to £1,500,000 and the indebtedness of the 117 hospitals in the London area amounted to £383,000.
The Government then set up a Commission, under the present Lord Chancellor, of which the hon. Member for Ogmore (Mr. Hartshorn) was a member, to inquire into the whole financial position of the hospitals, and make recommendations as to the action which should be taken to assist them. The Commission made 13 recommendations, some of which have been carried into effect. The main recommendation was that Parliament should be asked to sanction a temporary grant of £1,000, to be expended at the discretion of the British Hospitals' Association, on the assistance of those hospitals which might require assistance, but, as the House will remember, it was found possible to sanction a grant of only £500,000, so that they were not helped to the extent which the Commission had recommended. The eleventh recommendation was as follows:
The request is put forward that testimentary gifts to hospitals should be exempt from the 10 per cent. legacy duty. We understand such exemption is allowed in the United States and is believed to have a marked effect in encouraging bequests to hospitals. There appears to be no good reason why the State should intercept, at the source, one-tenth of all the sums bequeathed for the benefit of the sick, and we recommend that these gifts be free from the duty. This recommendation applies to legacy and succession duty, but not to estate duty.
This recommendation has, so far, never been carried into effect. The first question one asks oneself, in considering a
proposition of this kind, is: how much is it going to cost the Exchequer? I gave figures last week on the Committee stage which I had taken—in the absence of other statistics which the right hon. Gentleman was unable to give us—from "Burdett's Hospital Year Book," and the cost, I made out on that occasion, amounted at the outside to £80,000 a year. I have since been in communication with the British Hospitals' Association and the King Edward Fund who have gone carefully into the figures and they inform me that the figure which I gave represented an average year between 1913 and 1921 and was a little too low, and that the true average of the cost to the Exchequer was a sum not exceeding £130,000. In return for this concession the Government would give a tremendous fillip to the voluntary system which at the moment is in grave danger of breaking down. The Minister of Health said so last week on the Ministry of Health Vote. It would also, as the Cave Commission pointed out, undoubtedly encourage legacies to hospitals. Some would very possibly adduce the argument that it is better to make another lump sum grant to be expended in the assistance of those hospitals which require it rather than grant this concession, but the strong counter-argument to that is that whenever you make a lump sum grant or subsidise a voluntary hospital in any way, you directly discourage the voluntary system, whereas by abolishing the Legacy Duty you directly encourage the voluntary system. I should like, if the House will bear with me, to quote the opinion of the Cave Commission on that point. They say:
It has been suggested by some, but a very small minority of the witnesses who have been before us, that liability for the hospitals should be taken over by the State or thrown upon the rates, or, at least, that regular yearly grants-in-aid should be made from one or other of those sources. In our view, that proposal would be fatal to the voluntary system. If it is once admitted that there is an obligation either on the State or on the local authorities to nuke good deficits, the hospitals will have lost their incentive to collect and the subscribers their incentive to contribute.
I particularly wish to emphasise that point because I have no doubt the right hon. Gentleman in his reply will say that this concession means in effect a State subsidy. [An HON. MEMBER: "Hear, hear!"] I understand the right hon. Gentleman to say "Hear, hear!" but the
House will notice that whereas the Cave Commission do not recommend any form of State subsidy, if it can be avoided, on the ground that it discourages the voluntary system they do very strongly recommend this concession on the ground that it directly encourages the voluntary system, and they argue that it does not amount to a State subsidy because the money which would be given to the hospitals under this concession should never have been taken by the State at all. Some may have their doubts as to whether the voluntary system is worth saving. I do not wish to labour that point; I have no doubt some hon. Members opposite do not believe in the voluntary system, but as this is not a party question, I do not wish to enter into any dispute about that, and I would once again read the opinion of the Cave Commission of which the hon. Member for Ogmore was a member and to the report of which he appended his signature. They say:
The position of a large number of hospitals is such as to make it impossible that they can be continued on the pre-War basis unless prompt and vigorous measures are taken to re-establish the position of 1914. Is the voluntary system worth saving? We are convinced it is. If that system falls to the ground, hospitals must be provided by the public, and the expense of so providing them would be enormous. They must then be carried on without the aid of voluntary subscriptions and donations estimated at no less than £3,000,000 a year and, presumably, without the sum, amounting to about £1,000,000 a year, from endowments which were given to start the voluntary hospitals.
So long as the voluntary system is in operation it is our duty to see that the sick are provided for in every way. Personally, I think the voluntary system is the best. I am of opinion, generally speaking, that our fellow countrymen and women who can afford to do so subscribe to the relief of the suffering to the utmost of their power, and this is demonstrated by the fact that in spite of increased taxation, bad times, bad track, and the tightness of money generally, donations and subscriptions to the voluntary hospitals have increased since 1914 by 67 per cent. No doubt the right hon. Gentleman will argue in his reply that if you exempt the voluntary hospitals from the payment of this duty you will have to exempt all other charities from
the payment of the duty also. Are the other charities, missions, and so forth on parallel ground with the case of the hospitals? If the voluntary system breaks down, the whole of this expense will be thrown on the State, but if these other charities break down through financial difficulties that is not the case. You will not have this added expense on the State, and I maintain there is a very strong argument on that ground.
As I pointed out last week, there is no difficulty in discriminating between the voluntary hospitals and the other charities. There is a precedent. The Government have already discriminated between the hospitals and the other charities by setting up the Cave Commission in 1920, and making a grant of £500,000 to the hospitals only in that year. Only those who are closely associated with the voluntary hospitals appreciate and understand the appalling difficulties which they have to face at the present time, and the magnificent and uncomplaining courage with which they are facing those difficulties. The good work which they are doing at the present moment is beyond all praise. At the end of the last financial year the total indebtedness of the hospitals of Great Britain amounted to just under £700,000. The total indebtedness of the hospitals in the London area amounted to £171,000. The hospital with which I am most closely associated, the Royal Northern Hospital, has a debt this year of very nearly £50,000. This is the hospital upon which the people of a vast and thickly populated area in North London depend entirely. At the present moment there are 157 urgent cases awaiting treatment. Owing to this debt, we have to close down two of our wards by the end of July unless we can raise £20,000 with which to carry on. The right hon. Gentleman and the whole House will appreciate the appalling difficulties which a debt of this magnitude presents, and the way in which it is bound to impair the efficiency of the hospital. We are a comparatively new hospital and have not had time to build up those legacies upon which all hospitals rely for their regular income. We have only a regular income of £2,000, and our yearly expenses amount to £80,000. We have to collect £78,000 every year to carry on our work. I do appeal most sincerely to the right hon. Gentleman to give some
encouragement to voluntary hospitals this year in facing this appalling difficulty. This concession would undoubtedly be of value. I appeal to hon. Members of the House for their sympathy and support in what I submit is a very reasonable and just appeal.

Major CADOGAN: I beg to second the Motion.
Having listened a few nights ago to the Financial Secretary to the Treasury explaining that the symptoms of the entertainment business were not those of exhaustion, but rather of reanimation, I am a little bit apprehensive that with equal force and cogency he may explain that the present precarious position of the voluntary hospitals is more apparent than real. If that is his intention, I would remind him that this New Clause is based upon the findings of Lord Cave's Commission, which indicates a very disquieting state of affairs as far as the voluntary system is concerned. I anticipate that there may be opposition from a quarter of the House that is not altogether favourable to the voluntary system, but I ask the House to remember that donations and subscriptions and legacies have increased enormously in recent years. If the reverse were the case, or if it could be proved in any way that voluntary effort was flagging, I should be compelled, reluctantly, to admit that the voluntary system had failed; but facts are on our side.
As the Noble Lord pointed out, between 1913 and 1921 voluntary effort has increased by 67 per cent. He should have said that that is in the London area. That is a very good indication that voluntary effort is not failing. I am informed that last year the combined appeal produced something like £500,000 in the same area. As long as the volume of that effort increases, although it is not increasing in proportion to the needs of the hospitals, I shall contend in this House that we should give every encouragement to the voluntary system, which not only saves the taxpayers between £3,000,000 and £4,000,000 a year, but undoubtedly functions far more efficiently than a State-aided system could possibly do. The Cave Committee asserted that the voluntary system was worth saving. I am convinced that this is the case, and that that is the opinion of those conversant with the subject.
I have the honour to serve on the council of two hospitals, the Victoria Hospital for Children and the Chelsea Hospital for Women. The perfunctory service I have been able to render on those councils do not qualify me to speak with authority, but it has enabled me to come into contact with those whose opinion we must respect, namely, the opinion of the management, of the staff, and also of the patients, and those great bodies of opinion consider that the continuance of the voluntary system is essential, in spite of its anxiety, in spite of its difficulties, and in spite of the fact that the staff, at any rate, might well expect under a State-aided system higher salaries and emoluments. In spite of that, they are in favour of the continuance of the voluntary system.
If this new Clause passes, some of these difficulties and some of these anxieties will be removed. If it fails to pass, by the measure of its failure the hospitals will be the less able to overcome the difficulties with which they are faced. I understand that the State intercepts at the source about one-tenth of the sums which are left for the hospitals. That sum does not represent a very great accretion to the Treasury, but it represents a quite appreciable loss to the hospitals. I am not appealing to the Government to accept this new Clause on the ground that the remission of Legacy and Succession Duty would be only a small consideration. I rejoice that the Treasury no longer accept as valid the excuse that our offspring is only a little one. It is a good symptom that the Treasury has turned over a new leaf in that respect. I am not attempting to defend this new Clause on such grounds, but I invite the Treasury to bear in mind that if the voluntary system fails, the sacrifice of revenue entailed by this Clause will appear infinitesimal compared with the huge expenditure of public money which will be necessary.
It always seems to me a somewhat sacrilegous act on the part of the Treasury to appropriate to itself the testamentary dispositions of those who intended their bequests to heal the sick. It seems to me like taking the medicine out of the patient's mouth. If the Treasury is haunted it should be by the uneasy spirits of those benevolent human beings who have left legacies for the purpose of healing the sick, part of which
is deflected to uses which may not be so reputable as those for which they were intended. I do appeal most strongly to the Government to accept this new Clause. The present position of the voluntary hospitals is undoubtedly causing the gravest concern to all those who manage them, and those who derive benefit from them. I hope that the Government will be able to make the position a little more hopeful to those who have done such splendid work to ameliorate the physical condition of this country through the medium of the voluntary hospitals.

Dr. MACNAMARA: We can congratulate the Mover and Seconder of this proposed new Clause upon the industry and strong endeavour with which they have pursued this matter, and gone into this great problem. I hope before the Debate is over to show them that there is no one more heartily with them than I am. I have not been successful in an earlier venture in my appeal to the right hon. Gentleman, but that, so far from discouraging me, has given me greater hope, that I may be more successful on this occasion. If the right hon. Gentleman will look at the Order Paper, he will see—no doubt, he has already done so—that there is a proposal in precisely the same terms as the one under consideration put down in the name of the hon. Member for Ogmore (Mr. Hartshorn) and other three hon. Members, including myself. Therefore, this matter is pressed upon the Financial Secretary by representatives of all the parties in this House. I do not think there is much need to deal with the respective merits of the voluntary system and of a State system. That is not at issue. The Cave Committee unanimously agreed that the voluntary system was worth saving, and they went on to point out the serious and critical situation in which these great institutions now find themselves. Many of us know what are the facts. The Cave Committee made this particular recommendation.
9.0 P.M.
Already I have referred to that great institution, one of the greatest in South London, that is the King's College Hospital, Denmark Hill. There it is, a greater boon to that community was never bestowed. Its case is this: There are six wards closed, with 180 beds, and 1,000 poor people on the waiting list. [An
HON. MEMBER: "The voluntary system!"] Do not let us argue that. If we go on waiting until we have got a perfect system we may wait a long time. I am not judging that question at all. There are these thousand people waiting, many of them very ill. I am afraid some of them will be dead before these beds are made available. As a matter of fact, the interest on the debt of this great institution would open two of these wards and 72 beds. I do not want to say any more about that; but there are two arguments which those of us who press this upon the Treasury may have used against us. The one is if you allow this Legacy and Succession Duty to escape what will happen will be that to that extent you will be giving 10 per cent. of the total benefaction to the executors of the estate. Supposing, for instance, £1,000 is left. In that case £900 will go to the hospital, and the £100, instead of going to the Treasury, will go to the beneficiaries under the will. That may be so in some cases but that could be immediately adjusted. [An HON. MEMBER: "No!"] Of course it will. The £1,000 would be left in view of the altered condition, and provision made accordingly. Therefore, I set aside that argument—that you are really taking from the Treasury and putting it into the pockets of private beneficiaries. That might arise in the first few instances, but that could soon be adjusted. The other is a more serious argument; it is to the effect that if you do this, how can you resist the appeals that will be made from all sorts of classes of an analogous character asking for concessions. But the hospitals—these great institutions—stand apart. Take, for instance, the research work and the training of nurses and doctors that are walking the hospitals. All that is State service which has to be given, and it is given by these public officers. Apart, therefore, altogether from the treatment of patients, you have that big question of the training of nurses, doctors, and surgeons. I shall support the proposition as strongly as I can, as a particular case which ought not to be quoted as a precedent. This is a plea by itself, and if this were conceded it would not justify other charities making requests which were rather in a different position. I shall strongly support the request.
There is a third point—I have mentioned two. It may be said that the concession asked for is in the nature of a concealed subsidy. So it is, and, in this case, wisely so. The Financial Secretary may say that the better way is to make a direct Treasury grant. Not at all! The moment you begin to give a direct Treasury grant, then the voluntary system begins to decline, and that is not desirable if it is desired to maintain it. The majority of the Cave Committee recommended, accordingly, that this is the very way in which you can give what is asked without undermining the voluntary system. You may call it casuistry on my part in so arguing, but I am not much concerned on that point. You may give a concealed subsidy which would not have that direct effect upon the voluntary system that a direct subsidy would. Representatives of all parties are agreed in putting forward this proposal which none of us wish to use as a jumping off place for a new claim upon the Treasury. Not at all. We wish it to stand by itself, and I commend it with all the earnestness at my command to the right hon. Gentleman's consideration.

Sir W. JOYNSON-HICKS: I join with the right hon. Gentleman who has just sat down in congratulating those who put forward the case. It is perhaps as well that I should state the view of the Government, because in this matter those who have spoken, and who have given the fullest possible information in regard to the hospitals, have the one great advantage of knowing exactly what I was going to say. We have gone into this matter very fully. On the last occasion when it was raised in Committee I agreed to receive a deputation, with a perfectly open mind, and I received that deputation—I must confess a very representative deputation—and they put a very strong case indeed before me. But they did not convince me. In this matter I have consulted the Prime Minister. He was not convinced either, or that this was the proper way to deal with the admitted difficulties that the hospitals suffer from at the present time. The three hon. Members and the right hon. Gentleman have given a very strong view of the grave difficulty of the hospital situation. The right hon. Gentleman has spoken of wards about to close—

Dr. MACNAMARA: Closed!

Sir W. JOYNSON-HICKS: And the people waiting to get into them who may die before provision is made for them. All that is perfectly true. Nobody knows better than I do. I know a great deal of the difficulty of getting money under the voluntary system. I have been for a long time connected with the hospitals, and I know how difficult it is to get the money for the upkeep of those institutions. In this Debate I think hon. Members have really proved too much, for they have proved that the condition of things is such that this Amendment would really not get to the root of the matter. The right hon. Gentleman the Member for North-West Camberwell (Dr. Macnamara) tried to answer the inevitable objection to this Clause. I want the House to realise that the Government is not hostile to the hospitals fit all, and it is just as keen to help the hospitals as the supporters of this proposal. They believe, however, that the proper way would be for the hospitals to come and ask, not for a concealed subsidy in this way, but for an open subsidy.
The right hon. Gentleman the Member for North-West Camberwell swept away this argument as if it was nothing to allow all these legacies to go free of duty. If a man leaves, say, £1,000 to the hospital and the rest of his property to his wife and children the hospital does not pay any duty, but the wife and children have to pay £100 duty. If this Clause were carried in the case of the husband who gave a legacy of £1,000 to the hospital the wife and family would not have to pay that £100 duty, and we should be giving to the wife and family the £100 which they would otherwise have to pay. This proposal would affect one-half of the legacies, and in all existing wills that would be the case. This is a concealed subsidy, and it is to be given by the Government out of the taxpayers' money by the taxpayer in a way in which the taxpayer would have no control at all. It is the case of a selection against the Government by a testator. He may say, "I am going to leave Hospital A £1,000." That hospital may be a very wealthy hospital, or it may not be one of the best conducted hospitals, but still the Government has to pay Legacy Duty to that hospital, which may or may not be worthy of receiving it because the man who makes the will can select where the tax has to go and not the Government.
If this were an open subsidy, if the House concluded that the position of the hospitals under the voluntary system was on the verge of breaking down, and if they said, "We cannot carry on," the Government would be bound to say, "We will give a subsidy to the King Edward Hospital Fund or some committee of £100,000 or £130,000 a year, as the case may be, to be distributed to the hospitals, not as Mr. Brown or Mr. Jones might decide, but as the King Edward Hospital Fund decide is desirable," or the Government decide which hospitals are most in need of it. I think that is much fairer than leaving it to the testator to decide how the taxpayers' money is to be disposed of. The right hon. Gentleman the Member for Camberwell says quite frankly that they would not take advantage of this precedent if adopted for every other kind of charity, but how could he guarantee that? Already since this Clause was put on the Paper I have had an official letter from St. Dunstan's asking that they should be included, and why not? Are they not a most excellent charitable institution? The moment this Clause is conceded you would find a Clause put down that St. Dunstan's should be included—[an HON. MEMBER: "And the lifeboat institutions!"]—yes, and the lifeboat institutions as well.
The hon. Member for Reading (Major Cadogan) put it to the House that the Government tax on hospital legacies was almost sacrilege, but what about the gifts for religous purposes. If hospitals demand that legacies should be exempted how about charitable institutions and churches and chapels that care for the souls of the people? Would they not come forward with the charge of sacrilege with even greater force than in the case of hospitals, and we should have the same charge brought forward with regard to other forms of charity. Although hon. Members may argue that we ought to differentiate between hospitals and other charities, I am quite sure they will agree with me when I say that if we agree to this proposal there would be in a very few years, or even in the very few months, strong demands made for us to extend this practice to every other form of charities, and the representative of the Treasury would have great difficulty in resisting them. What that would cost would be something enormous.
As to what this Clause would cost, my hon. and gallant Friend, when he made his statement on the Committee stage, said it would cost £80,000. He put it too low, and he now puts it at £130,000. If he included those very large donations made by Lord Swaythling and Lord Mount-Stephen, it would come to something like £180,000. The information given to me by the Inland Revenue puts the average at about £200,000. Whether that is the right amount or not, it is, at any rate, a great inroad into the taxation of the country. The real reason why the Prime Minister and myself are going to ask the House not to pass this Clause to-night is because it is applying what the right hon. Gentleman has so frankly said was a concealed subsidy to one particular form of charity. It cuts into the whole substratum of our Legacy Duty provision of taxation, which has been in existence for many years. For a long time it has been a principle of our finance that the wife and the child have the best claim upon the estate to be relieved of Legacy Duty. The man who saves is primarily thought to be saving for his wife and family, and, therefore, he should be taxed the least of all, and the wife and children should be let off lightly. The wife and the children have a right to expect that a man shall leave what he can to them, and the State recognises that right by taxing them as lightly as possible.
Charity of all kinds has not the same claim. It is a national voluntary act on the part of the State, and the State has said, and I think rightly, that where there is no claim of relationship or of blood in the case of a legacy of any kind, there the State is entitled to take a much greater slice than when it comes to a wife and family. That is the whole substratum of our Testamentary and Legacy Duty law, and that has stood the test for many years past. It was instituted, I think, by a very great Liberal Chancellor of the Exchequer, the late Sir William Harcourt, many years ago. It has survived many attacks, and I appeal to the House now to say that it is not right in the interests of the taxpayers, however much one may wish to plead for support to the hospitals—and we have all done it in our constituencies and our home neighbourhood—we have helped as far as we have been able to—it is not right that
the House should take this money which belongs to the nation and give it to a particular form of charity in the nature of a subsidy rather than go openly to the nation, the Treasury and the House of Commons and ask them to rescue the voluntary hospitals from their dir, necessity. I am sure if such an appeal were made openly, the House of Commons would not be ungenerous in considering it.

Mr. CHARLES ROBERTS: The Financial Secretary to the Treasurer has made a strong appeal, and has invested with much emphasis the doctrine that the State lays its hands on every sum of money which passes at death, and must have its pound of flesh out of all charities, even those to hospitals. I could not help noticing that the right hon. Gentleman dealt out to us a rather different measure when he was talking about the Report of the Income Tax Commissioners. In cases where the Income Tax Commissioners have reported against a particular concession that Report has weighed very heavily with him, and he has suggested that, however good the claim for the exemption, the Report of the Commission settles the matter. But when he comes to deal with the Report of another Commission which ventures to trench upon the sacrosanct principle that the hospitals must pay tax he takes a different line. He does not attach the same amount of importance to that Report, because it does not regard so strongly the principle which he has com mended to the House. I agree with the right hon. Gentleman that the question whether the hospitals should be continued on the voluntary system or on a State system does not really arise in this connection. That very much wider problem should be decided, not on the narrow issue of particular liability to taxation, but on very many other considerations, such as the progress of medicine, nursing, and so on. It is a question entirely outside the scope of this Amendment.
The only question now is whether, under the circumstances in which we stand to-day, this claim for exemption or abatement should or should not be conceded. I cannot help thinking that the situation has been largely altered by the action of the State itself, and that the present difficulties of the hospitals are due considerably to the enormous increase in the burden of taxation, which has
undoubtedly dried up the sources from which hospitals have received a good many of their legacies in days gone by. Those who are pleading the case of the hospitals can point to the fact that their difficulties have been caused partly by the State itself, which has thrown on the public this enormous burden and made it far more difficult for people to contribute to the hospitals. That being the case, surely, the State might facilitate in some way, in the form of allowances, or exemptions, those who are willing to contribute to the hospitals. I have had the case put before me of a number of provincial hospitals in the Midland Counties, where, although the claims upon them are very heavy, the individual sources of charity are by no means drying up, as increased efforts have been made since the War to help the hospitals. I regard it as a real confusion of thought to call this proposal a direct subsidy by the State. I am reminded of the exemptions already given in reference to life insurance, and when the Financial Secretary suggests that if this concession were granted it would be difficult to refuse the same concession in regard to legacies to churches and chapels, I must say I have not the least doubt that, if the case were presented to him, and if he could be moved from his present recalcitrancy, he would find no difficulty in differentiating between the cases of the churches and chapels and the hospitals. It seemed to me, when the right hon. Gentleman was laying stress on the impossibility of distinguishing between charities of primary necessity, from the paint of view of life and death, and charities of secondary necessity, such as legacies to churches and chapels, if he set himself to the task he would find it very easy to distinguish between the two.
Probably the real point he desired to make was that the Government had not the money and could not afford to lose his £200,000 which the concession would cost. I have very little patience with such an argument when I think of what the Budget is at the present time. Surely a very little ingenuity, say, in the direction of not giving concessions which have already been given in regard to the liquor taxes, would have enabled him to find the necessary money. Especially may I mention a fact which we discovered this afternoon, that the Government is providing a sum of £300,000 for Scottish
landowners. If they can do that I do not think they are entitled to come here and say they cannot find money for the hospitals. The claim is a very strong one. I do not think it need carry concessions further than is required. I do not think it involves in the least the question whether the hospitals should remain under a voluntary system or should be under a State system. I suppose the Government have put their foot down, and are not prepared to make this concession, unless the appeal comes from their supporters, in which case, possibly, they might change their mind. I cannot help expressing my great regret and disappointment that they have not seen their way to meet this case.

Colonel Sir CHARLES BURN: As a Governor and member of the House Committee of St. George's Hospital I feel I may be allowed to raise my voice and appeal with all the earnestness I possess for this concession to be given in order, at any rate, even in a small way, to ease the present financial situation of the hospital. I sit, week by week, when the board of the hospital meets, and I can assure the House that it is heartbreaking, week after week, to hear the same tale of the overdraft at the bank It is no use my saying what an enormous benefit these hospitals confer on the people of London, and, indeed, all over the country. In the case of St. George's, everybody who lives in the neighbourhood, who requires hospital attendance, comes in the hope of getting in. Week by week we have to refuse admission to hundreds, and, indeed, the hospital has been carried on really by living on capital. One beneficiary, the late Mr. Gorringe, whose name is well-known throughout this end of London, gave a large legacy which, if invested might have produced a comfortable income to assist the hospital, but when you have to live on capital the income, alas, is gone. We know the hospitals are in a bad way, but I can answer for St. George's being anxious to retain the voluntary system. We know that one volunteer is worth 10 pressed people, and so long as the hospital is run on the voluntary system I have no hesitation in saying that the work of the hospital and the general feeling of the patients in that hospital is a more comfortable one.
We know that in these days things are very difficult, and the proof of how much the people of this country think of their hospitals, and that they do everything in their power to assist them, is the fact that really the voluntary subscriptions have not decreased, but rather have increased even in these difficult times, when we are taxed almost out of existence. When a hospital really is struggling to run on by the voluntary method, a small encouragement such as this given to it by the Treasury would be very greatly appreciated, and would certainly produce a renewed effort to get subscriptions in from every possible source. I hope that even at this hour, when the decision of the Treasury has been given, an appeal which really comes from the heart will not be scorned, but that the concession will be given, because if the voluntary system is to end the Government must give a subsidy to its hospitals, and is it not much better that the Treasury should now make this concession voluntarily rather than have to fall back on the taxpayer's money by giving what would be almost a forced concession to keep the hospitals of the country going?

Mr. G. SPENCER: I cannot hope to follow the right hon. Baronet who is in charge of this Bill with regard to the legal side of the question he has propounded. He is far more capable of dealing with the legal side than I can ever hope to be, and I only want to say a few words with regard to the practical difficulty that exists to-day concerning the working-class population. I quite agree that the issue to-night is not Voluntary versus State-aided hospitals. That is, undoubtedly, a very important question and might create a very keen and controversial discussion. The real issue is, Shall the hospitals function to the extent of their capacity in the interests of humanity? That is the real issue, and I am quite convinced that any hon. or right hon. Gentleman who has any knowledge whatever of either the provincial hospitals or hospitals in London knows perfectly well that many of these institutions are failing to function to the extent of their capacity not because there is any lack of voluntary help offered from the medical point of view, but simply because the hospital has not the money with which to carry on. That is a very serious
thing indeed from the point of view of the working-class population. I have had pass through my hands just recently two cases of men who got strangulated hernia by working in the coal-pit, and these men were week after week on full compensation, and an unnecessary charge on the industry and the owner, and were suffering themselves because there was no room whatever in the hospital for lack of funds. That is a very sad and serious state of affairs. I think the Government would have a case if they could turn round to us and say, "What have you done yourselves to assist the hospitals and relieve the financial strain under which they are working?" I can say to the Treasury Bench that, so far as the workmen with whom I am associated are concerned, they have doubled their contributions to the hospital in the district. That is to say, where we used to pay 1d. a week the men have decided and agreed that 2d. should be deducted from their wages for the purposes of the hospital, and it is because we have undertaken to do this thing ourselves, and we find that after doing it the expenses of the hospital are of such an extent, owing to the increased cost of living, that they cannot function as they wish to do that we think they have a right to come to the Government, and say, "What are you prepared to do?"
The Noble Lord in charge of this new Clause (Viscount Ednam) stated that he thought this would cost the Treasury about £130,000, but the Financial Secretary to the. Treasury put forward as the case from the financial point of view that it would cost, according to his advice, £200,000. In my opinion that is not an argument why he should not concede this request, but is an argument why he should do so. It is only an evidence of the extent to which the hospitals are being financially crippled by the imposition of this Legacy Duty, and if it had been taken away it would mean that the hospitals would have benefited during the last year to the extent of £200,000. It is true that would not have wiped away the deficit and debt, but it would have gone a long way to make it possible for these beds to be opened again and to relieve to a far greater degree than we are actually doing the suffering that exists to-day. The Government say, "We cannot do it in this way. If we do it for hospitals, we must go further." The Government
must choose one of two things: they must either support the voluntary principle, as has been recommended by the Cave Committee, by some method or other—either by a concealed subsidy or in some other way—or they must state openly that they are going to make a definite grant and are going to do away with the voluntary system, which has been so admirably adopted in this country and has done such useful service, and are going to have State-aided hospitals, the whole charge for which, whether it be £200,000 or whether it be millions, will fall upon the country, instead of being contributed in the way in which it has been. The Government must make up their minds. The Clause before the House only involves a very small concession, and I cannot see why the Government cannot make it in the interests of humanity.

Captain Viscount CURZON: I have the greatest possible sympathy with the remarks that have fallen from the hon. Baronet the Member for Torquay (Sir C. Burn), from the hon. Member for Derby (Mr. C. Roberts), and from the hon. Member for Broxtowe (Mr. G. Spencer). Like the hon. Baronet the Member for Torquay, I speak on behalf of quite one the biggest and best charities in this country, though it is not a hospital. I am the only Member of this House who is able to speak on behalf of the National Lifeboat Institution, which, like the hospitals, is supported entirely by voluntary contributions Our view has always been that, if we got a subsidy from the State, whether concealed or direct, it would have the very gravest possible effect upon our voluntary contributions. We contend, and we always have contended, that if the State supports us in any shape or form, we shall not be able to say to the country that we are a voluntary institution dependent upon voluntary funds, and we shall find our supporters in the country saying, "Well, you get money from the State. If you have not got enough you must get more."
I have the greatest possible sympathy with all the hospitals, and, indeed with all charities, and I am sure there is no hon. Member in any party or in any quarter of the House who does not share that sympathy in full measure. The issue had been very fairly stated by
the hon. Member for Broxtowe, who remarked that, if you are going to do anything in this matter, you have to decide whether the hospitals and other charities—because it does not only concern hospitals—are going to be supported by the State The Financial Secretary was right when he said that, if we do this for hospitals, we shall have every other charity asking for the same concession. If the Government are able to afford the concession asked for in this Clause, well and good, but it must be an all-round concession. I agree with the Financial Secretary that, if a testator is able to pick out a certain hospital which he fancies, and his bequest is to be free of Duty, it does mean that that testator is geting the right to exempt from taxation that particular charity. I submit that that is the wrong way to go about it. If we really want to do something for charity, the way to do it is for the Government, as the Financial Secretary has said, to come to the House and say they want so much money per annum for charity, be it half a million or a million, and to give so much to King Edward's Hospital Fund and so much to other charities, which will be allocated by some Committee or other. Do not, however, let us start by singling out hospitals.
The hon. Member for Derby made some remark to the effect that it was easy to draw a distinguishing line between charities of primary necessity and those which were not of primary necessity. It is a very old saying that comparisons are odious, and I really do not envy the fellow who has to draw the distinguishing line between charities. He will make friends of some, but he will make enemies of a great many more. Before the House gives its assent to such a proposal as this, it should realise that this is not a question that affects hospitals only, but one which affects all charities throughout the country, and that it must be faced as one big issue and not treated piecemeal. I do not believe in piecemeal legislation of any description. I hope, therefore, that the House will support the Government in resisting this proposal, until the Government tell us that they are able to accede to the request with regard to charities as a whole, not dealing with hospitals as one single unit.

Colonel M. ALEXANDER: I also am associated with a great institution, being a member of the Governing Board of King's College Hospital, and I am also connected with another hospital. I have tried to listen with an impartial mind, but I cannot accept the statement of the Financial Secretary to the Treasury. I am sorry he is not here at the moment. I notice that the learned Solicitor-General is about to reply on his behalf, but I somewhat regret that the legal profession is to cure us from our physical ailments. I thought it could cure in a legal way, but not in the other way. I entirely disagree with the Noble Lord the Member for South Battersea (Viscount Curzon). He has singled out one institution, and has stated that, if a grant were given to the hospitals, a grant should be made equally to other charitable institutions. The Noble Lord stated, and stated rightly, that any hon. Member, or any man, who might try to draw the line in that particular sphere of charity, would make a few friends, but a good many enemies. I intend to make the enemies in this case, because I intend to draw a line between the hospitals and other charitable institutions. Let me assure the House that there is no comparison between the present position of the hospitals of this country and the other charitable institutions, however great their needs may be. The Noble Lord asks why. Let me tell him why.
The hospitals to-day are not only helping to save people from actual death, and to save them from the terrors of the ailments with which so many of our people are afflicted, but are actually training the doctors and nurses for taking care of our people, and doing research work, which is, probably, the greatest cure of all. Look at the question of tuberculosis, the cure of which, and of many other diseases, has been developed in our hospitals, I think I can say with every degree of sincerity that there is no charitable institution in this country which can say that it is of equal importance with our hospitals to-day. The hospitals, undoubtedly, stand in a class by themselves. Let me deal with the argument of the Financial Secretary to the Treasury, who told us that if we want a concession, we must come before the Government and say we want £100,000, and he will consider it. Let me point out to the House that such a
request, whenever it is made, will get a very cold reception. We shall be met by the Treasury with the answer, "If we give you a subsidy, why should we not give a subsidy to every other charitable institution? And if we give a subsidy to every charitable institution, well, the country has not enough money to do it, and, therefore, you cannot have it." There is, however, a still greater danger in the fact that at the present moment people give freely to hospitals because they know that if they stopped giving the hospitals would go under. If they realise that the Government is going to make good any deficit, people will say they are giving enough in taxation, let the Government take care of the hospitals altogether. It may satisfy my friends on the Labour Benches who advocate the State control of hospitals. The voluntary system of hospitals is the best and, I believe, the most beneficial to the community as a whole, and for that reason, if for no other, I should like the Solicitor-General to take note of what I am saying, and, if he cannot accede to our request at the moment, at least try to put the hospitals in the relationship of a wife or a child to the testator.
We have heard a very lucid explanation that a wife or child is only taxed 1 per cent. while a hospital is taxed 10 per cent. It was said if you give that exemption the testator will save the money, because the present relatives have to pay. The real danger lies in this. It is perfectly true that the man who gives £1,000 may not increase his donation if you exempt it, but the bulk of donors are smaller people who give £200, £300, or £250. If you tax them 10 per cent. they decrease their donations to the hospitals. If you make them tax free they will increase their donations and the hospitals will benefit. A subsidy would not help. To my mind a subsidy is a dangerous policy to adopt because if you start subsidising you do not know when to stop until you come to the very end of it and have to take it off. May I point out how much it would appeal to distinguised people across the seas? Lord Mount Stephen, who gave so great a donation, was a Scotsman who made his money in Canada; so was Lord Strathcona, and their donations amounted to something like £889,000. If you exempt them from taxation you will get still greater donations from people who take
a pride in the hospitals of the Motherland. What is needed to-day is something to give a lift up to people who are willing to contribute even in these hard-times, and a little encouragement may go a long way to cure the great evil in which we find ourselves to-day.

Sir W. LANE MITCHELL: The increased cost of living did not pass the hospitals. The ordinary income they had before the War was not enough to enable them to carry on adequately and we came to this, that a Commission was appointed to consider the whole position, and it found the claims on the hospitals were so clamant, and there were so many places being closed, that they recommended, first, a grant of £1,000,000 to tide over the temporary difficulty, and they made another recommendation that this Legacy Duty should be foregone. The Government did not give this £1,000,000. They said, "Take £500,000, and go on and do the best you can." The Financial Secretary to the Treasury argues against the 10 per cent. Legacy Duty being foregone as if it were something altogether new, forgetting the recommendation of the Cave Commission. If this question were left free to the House it would be carried. It is imposing too great a strain on us when it comes to a question of this kind, which makes such an appeal to every one of us interested in this class of work, to find ourselves up against a rigid barrier. I protest against it. The right hon. Gentleman says this is giving it in an indirect kind of way. Is he prepared to give them a half of what the Cave Commission recommended? Probably it will be another year before we have another chance of doing anything for the hospitals, and it is fair to put it to the Treasury, "Failing your agreeing to this, are you prepared to give a lump sum now to put the hospitals out of their difficulty?" You have St. Thomas's Hospital across the way, probably the best-situated in London to discharge its duties to the poor people. A very considerable section of it is closed. That ought not to be. It is a question of life or death, and we have a right to ask the Treasury to do one or the other and not put us off with fair promises a year hence. We want it now.

The SOLICITOR-GENERAL (Sir Thomas Inskip): The Financial Secretary
has been on this bench nearly the whole of the day, and I am sure the House will forgive him and commiserate with me. I think if I were in a more fortunate position I could make almost as eloquent a speech as the hon. Gentleman who has just sat down. Nothing is easier or more congenial to all of us than to make an appeal for an object which enlists universal sympathy. The pleas which have been made for the hospitals in their present plight have met with a sympathetic response from everyone present. It has been a little overlooked, however, as my right hon. Friend reminded the House, that the assistance to be derived by the hospitals from this concession, if it were granted, is much slighter than is supposed. At the highest estimate £200,000 a year is involved. My noble Friend put it at a smaller figure; I think somewhere about £130,000. There are something like 900 or 950 hospitals, as commonly understood, in the Kingdom. They are, of course, hospitals of different sizes. We are accustomed to think of the great hospitals in London and our other cities. They are not, of course, on anything like the same scale. Let hon. Members divide that £130,000 or £180,000 between even the large hospitals all over the towns and cities of the Kingdom, and they will realise that it is not going to rescue them from the unhappy position in which they find themselves at present.
Hon. Members must make no mistake at all about that. Then it is said, "We are not asking, and are not expecting, you to deliver the hospitals from their plight by this concession. All we are asking you to do is to encourage the private benefactor to give to the hospitals by his will, and he will be encouraged when he finds that he can give without his benefactions being taxed."
If the House will forgive me a personal reference, I happen to be the treasurer of two societies that will certainly make a claim on the Exchequer for assistance if this concession be given to the hospitals. One seeks to save the lives of boys by taking charge of them when they are youngsters; another is a very large almshouse, which provides for, literally, hundreds of old people; that saves the lives of old people. I find, in my experience as treasurer, especially in these days of high taxation, that a
number of people send donations in their life-time, because they realise that if they wait till they die their gifts will be taxed to a very large extent by the State. It cuts both ways. There are people who possibly may give by their wills a little more, because they realise that their legacies will not be taxed, but there are undoubtedly people to-day who do give in their life-time because they realise that their legacies will be taxed when they die. I think hon. Members rather exaggerate the effect that this concession may have on people who leave money by their wills. I suppose most of us will probably think that people who make their wills do not calculate nicely the exact sum they may give, but they say, "Put me down for £100, or £1,000." whatever it may be, in round figures, for the institution in which they are interested.
What it comes back to is this: Hon. Members say quite rightly, and nobody has said it with more force than the hon. and gallant Gentleman who spoke a few minutes ago: "Here are the hospitals, fulfilling a great public work. They are training places for those who will attend to us in our days of sickness; they are places of scientific research, and it is right that the State, which is so largely dependent on the results of that scientific research, as, for instance, in connection with tuberculosis, should pay them for doing that work." I recognise there is a cogency in that appeal, but what it really leads to is this, it is either an argument that should be directed to the community as a whole, considered as individuals, who may give out of their bounty to support these institutions which are doing a great public work, or it is frankly an argument that ought to be used to the State for making a direct subsidy to the hospitals to enable them to do this work for the community. It really is an argument which goes to that, and when the Member for Streatham (Sir W. Lane Mitchell) asked, "How much will you give us of the £1,000,000 which the Cave Committee recommended—of the other £500,000—if this concession is not granted?" then he adumbrated an appeal which, quite conceivably, might be made by hon. Members of the House in favour of a direct and undisguised subsidy to support the hospitals and the public work they are doing.
That is not the proposal before the House this evening. On these grounds, however much sympathy we feel, as we do feel sympathy—and even Members of Governments have hearts for such an appeal as this—however deeply we may recognise the position of the hospitals, it is not mainly because the Government cannot afford this sum, that is not the ground, but it is because, as my right hon. Friend pointed out cogently, it is impossible to make a distinction between one charity and another, and to draw the line; and secondly, it is because the real advance ought to be in the direction of a grant by the State if the hospitals do work for the State, that the Government feel compelled, however unwillingly, to resist this Amendment. I do not know whether I may appeal to the House to come to a decision. It is not that I want to stop hon. Members speaking, but there are a number of other Amendments, and if they will allow us to decide on this point now I shall be glad.

10.0 P.M.

Dr. CHAPPLE: This is so important a subject that I make no apology for continuing the Debate. The issue has now become, since the remarks of the Financial Secretary, supplemented by those of the hon. and gallant Member for South East Southwark (Colonel Alexander), one between making this concession or making a grant to hospitals. I think we should avoid, so far as possible, making direct grants to hospitals. That would be the beginning of the end of the voluntary system. So far as public and regular grants are made to the hospitals there will come a claim for State control. I think the voluntary system has been so efficient and economical that it would be a tragedy to convert it into a State system, and that issue is important in itself. The basis of the present voluntary system, and the reason for its amazing efficiency and economy is that it is based in love of service and human sympathy. Wherever you make the hospitals into State institutions you will find a demand for increased salaries, and for salaries where none are paid at all. The crowning glory of the voluntary system to-day is the immense amount of voluntary and gratuitous service rendered to the hospitals. People have devoted their lives to the hospitals, without receiving anything at all but the gratitude of the people whom they serve. The doctors
render their services for nothing. All their attendance and all their work are done practically gratuitously. If you convert the hospitals into State institutions you will run the risk of undermining them, and of doing a great injury to the advantages they possess in the way of efficiency and economy now.
An hon. Member has just told us that we have overrated the amount of money that this would mean to the hospitals. I do not think so. The direct benefit might be £200,000, or whatever it is, but the indirect benefit would be immense, because testators who have contemplated giving benefits to institutions will be diverted towards the hospitals if they have no taxation to pay, and you will find that an immense increase in the legacies given to the hospitals will probably result from this concession. Then the Financial Secretary said there were a number of competing institutions which would immediately make claims. I should not in the least be deterred by that, because there is no claim that ranks so high as the claim of the hospitals, and no service that is rendered is so high and so wide-spread as that of the hospitals. The hospitals not only attend on the sick, but they provide two professions. They provide the medical profession and the nursing profession, and that, I may say in passing, is more necessary now than ever, for after the 14th of this month no nurse will be able to practise her profession as a registered nurse unless she passes through these great institutions. It is more essential than ever that we should preserve the voluntary system and give all the assistance we can to our hospitals, in order to encourage the voluntary system as much as possible. One of the great difficulties has arisen, not because the fount of voluntary assistance has dried up, but because of the increased services which the hospitals are giving. Think of the enormous cost of X-ray plant, the manufacture of serum and the cost of individual doses. Insulin alone costs 2s. 6d. a dose. Think of all the other necessary extensions of hospital equipment. The demand has been so great that the hospitals are in difficulties. I press these considerations upon my right hon. Friend. I am disappointed he has given the reply he has given. If he had made the concession, the advantage would have been great, the encourage-
ment would have been great. We should not do anything that would undermine our voluntary system and have State institutions instead.

Viscount EDNAM: The hospital authorities for whom I speak do not want to divide against the Government; they would not divide against any Government. [HON. MEMBERS: "Oh!"] I am only stating their position. They have stated their case in the deputation to which I referred and to their representatives. They consider they have a strong case, and if the right hon. Gentleman is unable to grant them this concession, he is unable to grant it, but I am

bound to say that I am very greatly disappointed at the unsympathetic way—

Mr. SPEAKER: I would remind the Noble Lord that he cannot make a second speech.

Viscount EDNAM: I wanted to say that. I have been able to say what I wanted to say, and I beg to ask leave to withdraw the Clause.

HON. MEMBERS: No!

Question put, "That the Clause be read a Second time."

The House divided: Ayes, 153; Noes, 243.

Division No. 261.]
AYES.
[10.8 p.m.


Alexander, A. V. (Sheffield, Hillsbro')
Hardie, George D.
Potts, John S.


Ammon, Charles George
Harney, E. A.
Pringle, W. M. R.


Attlee, C. R.
Harris, Percy A.
Rae, Sir Henry N.


Barker, G. (Monmouth, Abertillery)
Hastings, Patrick
Rees, Sir Beddoe


Barrie, Sir Charles Coupar (Banff)
Hay, Captain J. P. (Cathcart)
Riley, Ben


Batey, Joseph
Hayday, Arthur
Ritson, J.


Benn, Captain Wedgwood (Leith)
Hayes, John Henry (Edge Hill)
Roberts, C. H. (Derby)


Bennett, A. J. (Mansfield)
Henderson, Rt. Hon. A. (N'castle, E.)
Roberts, Frederick O. (W. Bromwich)


Bonwick, A.
Herriotts, J.
Robertson, J. (Lanark, Bothwell)


Bowdler, W. A.
Hill, A.
Royce, William Stapleton


Bowerman, Rt. Hon. Charles W.
Hillary, A. E.
Saklatvala, S.


Broad, F. A.
Hinds, John
Salter, Dr. A.


Brotherton, J.
Hirst, G. H.
Scrymgeour, E.


Brown, James (Ayr and Bute)
Jenkins, W. (Glamorgan, Neath)
Sexton, James


Buckie, J.
John, William (Rhondda, West)
Shaw, Thomas (Preston)


Burgess, S.
Johnston, Thomas (Stirling)
Short, Alfred (Wednesbury)


Burnie, Major J. (Bootle)
Jones, Henry Haydn (Merioneth)
Simon, Rt. Hon. Sir John


Butler, J. R. M. (Cambridge Univ.)
Jones, Morgan (Caerphilly)
Simpson-Hinchliffe, W. A.


Buxton, Charles (Accrington)
Jones, R. T. (Carnarvon)
Sitch, Charles H.


Buxton, Noel (Norfolk, North)
Jones, T. I. Mardy (Pontypridd)
Snell, Harry


Charleton, H. C.
Jowett, F. W. (Bradford, East)
Snowden, Philip


Clarke, Sir E. C.
Jowitt, W. A. (The Hartlepools)
Spencer, George A. (Broxtowe)


Collins, Pat (Walsall)
Kenyon, Barnet
Stephenson, Lieut.-Colonel H. K.


Collison, Levi
Lambert, Rt. Hon. George
Stewart, J. (St. Rollox)


Cotts, Sir William Dingwall Mitchell
Lansbury, George
Strauss, Edward Anthony


Darbishire, C. W.
Lawson, John James
Thomas, Sir Robert John (Anglesey)


Davies, Alfred Thomas (Lincoln)
Leach, W.
Thomson, T. (Middlesbrough, West)


Davies Evan (Ebbw Vale)
Lee, F.
Thorne, W. (West Ham, Plaistow)


Davies, J. C. (Denbigh, Denbigh)
Lees-Smith, H. B. (Keighley)
Thornton, M.


Davies, Rhys John (Westhoughton)
Linfield, F. C.
Trevelyan, C. P.


Davison, J. E. (Smethwick)
Lowth, T.
Turner, Ben


Dudgeon, Major C. R.
Lunn, William
Wallhead, Richard C.


Duffy, T. Gavan
MacDonald, J. R. (Aberavon)
Walsh, Stephen (Lancaster, Ince)


Dunnico, H.
M'Entee, V. L.
Watson, W. M. (Dunfermline)


Ede, James Chuter
McLaren, Andrew
Watts-Morgan, Lt.-Col. D. (Rhondda)


Edge, Captain Sir William
Macnamara, Rt. Hon. Dr. T. J.
Webb, Sidney


Edmonds, G.
March S.
Weir, L. M.


Edwards, C. (Monmouth, Bedwellty)
Marshall, Sir Arthur H.
Westwood, J.


Entwistle, Major C. F.
Martin, F. (Aberd'n & Kinc'dine, E.)
White, Charles F. (Derby, Western)


Falconer, J.
Middleton, G.
Whiteley, W.


Foot, Isaac
Moreing, Captain Algernon H.
Williams, David (Swansea, E.)


Gosling, Harry
Morel, E. D.
Williams, Dr. J. H. (Llanelly)


Graham, W. (Edinburgh, Central)
Morrison, R. C. (Tottenham, N.)
Williams, T. (York, Don Valley)


Greenall, T.
Mosley, Oswald
Wilson, C. H. (Sheffield, Attercliffe)


Greenwood, A. (Nelson and Colne)
Murray, John (Leeds, West)
Winfrey, Sir Richard


Grenfell, D. R. (Glamorgan)
O'Grady, Captain James
Wintringham, Margaret


Griffiths, T. (Monmouth, Pontypool)
Oliver, George Harold
Wood, Major M. M. (Aberdeen, C.)


Groves, T.
Paling, W.
Wright, W.


Grundy, T. W.
Parkinson, John Allen (Wigan)
Young, Robert (Lancaster, Newton)


Hall, F. (York, W. R., Normanton)
Pattinson, S. (Horncastle)



Hall, G. H. (Merthyr Tydvil)
Phillipps, Vivian
TELLERS FOR THE AYES.—


Hamilton, Sir R. (Orkney & Shetland)
Ponsonby, Arthur
Dr. Chapple and Colonel Alexander.


NOES.


Agg-Gardner, Sir James Tynte
Ganzoni, Sir John
Nicholson, William G. (Petersfield)


Alexander, E. E. (Leyton, East)
Garland, C. S.
Nield, Sir Herbert


Apsley, Lord
Gates, Percy
O'Neill, Rt. Hon. Hugh


Archer-Shee, Lieut.-Colonel Martin
Gaunt, Rear-Admiral Sir Guy R.
Paget, T. G.


Ashley, Lt.-Col. Wilfrid W.
Gilmour, Lt.-Col. Rt. Hon. Sir John
Parker, Owen (Kettering)


Baldwin, Rt. Hon. Stanley
Goff, Sir R. Park
Pease, William Edwin


Balfour, George (Hampstead)
Gould, James C.
Pennefather, De Fonblanque


Banbury, Rt. Hon. Sir Frederick G.
Greaves-Lord, Walter
Penny, Frederick George


Banks, Mitchell
Greene, Lt.-Col. Sir W. (Hack'y, N.)
Perkins, Colonel E. K.


Barnett, Major Richard W.
Grenfell, Edward C. (City of London)
Perring, William George


Barnston, Major Harry
Gretton, Colonel John
Philipson, Mabel


Becker, Harry
Guinness, Lieut.-Col. Hon. W. E.
Pollock, Rt. Hon. Sir Ernest Murray


Bell, Lieut.-Col. W. C. H. (Devizes)
Gwynne, Rupert S.
Pownall, Lieut.-Colonel Assheton


Bellairs, Commander Carlyon W.
Hacking, Captain Douglas H.
Privett, F. J.


Benn, Sir A. S. (Plymouth, Drake)
Hall, Lieut.-Col. Sir F. (Dulwich)
Raine, W.


Bennett, Sir T. J. (Sevenoaks)
Hall, Rr-Adml Sir W. (Liv'p'l, W. D'by)
Rankin, Captain James Stuart


Bentinck, Lord Henry Cavendish-
Halstead, Major D.
Rawlinson, Rt. Hon. John Fredk. Peel


Berry, Sir George
Hamilton, Sir George C. (Altrincham)
Reid, D. D. (County Down)


Betterton, Henry B.
Hannon, Patrick Joseph Henry
Remer, J. R.


Birchall, Major J. Dearman
Harmsworth, Hon. E. C. (Kent)
Remnant, Sir James


Bird, Sir William B. M. (Chichester)
Harrison, F. C.
Rhodes, Lieut.-Col. J. P.


Blades, Sir George Rowland
Harvey, Major S. E.
Richardson, Sir Alex. (Gravesend)


Bowyer, Capt. G. E. W.
Hawke, John Anthony
Richardson, Lt.-Col. Sir P. (Chertsey)


Boyd-Carpenter, Major A.
Hay, Major T. W. (Norfolk, South)
Roberts, Samuel (Hereford, Hereford)


Brass, Captain W.
Henn, Sir Sydney H.
Robertson-Despencer, Major (Islgtn, W.)


Bridgeman, Rt. Hon. William Clive
Hennessy, Major J. R. G.
Rothschild, Lionel de


Brittain, Sir Harry
Herbert, Dennis (Hertford, Watford)
Roundell, Colonel R. F.


Brown, Major D. C. (Hexham)
Hewett, Sir J. P.
Ruggles-Brise, Major E.


Brown, Brig.-Gen. Clifton (Newbury)
Hilder, Lieut.-Colonel Frank
Russell, William (Bolton)


Bruton, Sir James
Hiley, Sir Ernest
Russell-Wells, Sir Sydney


Buckingham, Sir H.
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Samuel, A. M. (Surrey, Farnham)


Burn, Colonel Sir Charles Rosdew
Hogg, Rt. Hon. Sir D. (St. Marylebone)
Samuel, Samuel (W'dsworth, Putney)


Burney, Com. (Middx., Uxbridge)
Hohler, Gerald Fitzroy
Sanderson, Sir Frank B.


Butcher, Sir John George
Holbrook, Sir Arthur Richard
Sandon, Lord


Butler, H. M. (Leeds, North)
Hood, Sir Joseph
Scott, Sir Leslie (Liverp'l, Exchange)


Butt, Sir Alfred
Hopkins, John W. W.
Shaw, Hon. Alex. (Kilmarnock)


Button, H. S.
Hopkinson, A. (Lancaster, Mossley)
Shepperson, E. W.


Campion, Lieut.-Colonel W. R.
Houfton, John Plowright
Shipwright, Captain D.


Cautley, Henry Strother
Hudson Capt. A.
Simpson, J. Hope


Cayzer, Sir C. (Chester, City)
Hume, G. H.
Skelton, A. N.


Chadwick, Sir Robert Burton
Hunter-Weston. Lt.-Gen. Sir Aylmer
Smith, Sir Allan M. (Croydon, South)


Chamberlain, Rt. Hon. N. (Ladywood)
Hurd, Percy A.
Smith, Sir Harold (Wavertree)


Churchman, Sir Arthur
Hutchison, G. A. C. (Midlothian, N.)
Somerville, A. A. (Windsor)


Clarry, Reginald George
Inskip, Sir Thomas Walker H.
Somerville, Daniel (Barrow-in-Furness)


Clayton, G. C.
Jackson, Lieut.-Colonel Hon. F. S.
Stanley, Lord


Cobb, Sir Cyril
James, Lieut.-Colonel Hon. Cuthbert
Steel Major S. Strang


Cockerill, Brigadier-General G. K.
Jenkins, W. A. (Brecon and Radnor)
Stewart, Gershom (Wirral)


Colfox, Major Wm. Phillips
Jephcott, A. R.
Stott, Lt.-Col. W. H.


Colvin, Brig.-General Richard Beale
Jodrell, Sir Neville Paul
Sueter, Rear-Admiral Murray Fraser


Conway, Sir W. Martin
Johnson, Sir L. (Walthamstow, E.)
Sugden, Sir Wilfrid H.


Cope, Major William
Joynson-Hicks, Sir William
Sutherland, Rt. Hon. Sir William


Craig, Captain C. C. (Antrim, South)
Kelley, Major Fred (Rotherham)
Sykes, Major.-Gen. Sir Frederick H.


Croft, Lieut.-Colonel Henry Page
Kennedy, Captain M. S. Nigel
Thompson, Luke (Sunderland)


Crook, C. W. (East Ham, North)
King, Captain Henry Douglas
Thomson, F. C. (Aberdeen, S.)


Crooke, J. Smedley (Deritend)
Kinloch-Cooke, Sir Clement
Titchfield, Marquess of


Curzon, Captain Viscount
Lamb, J. Q.
Tryon, Rt. Hon. George Clement


Dalziel, Sir D. (Lambeth, Brixton)
Lane-Fox, Lieut.-Colonel G. R.
Tubbs, S. W.


Davidson, J. C. C. (Hemel Hempstead)
Leigh, Sir John (Clapham)
Turton, Edmund Russborough


Davidson, Major-General Sir J. H.
Lloyd, Cyril E. (Dudley)
Wallace, Captain E.


Davison, Sir W. H. (Kensington, S.)
Locker-Lampson, G. (Wood Green)
Ward, Col. L. (Kingston-upon-Hull)


Dawson, Sir Philip
Locker-Lampson, Com. O. (Handsw'th)
Ward, Col. J. (Stoke-upon-Trent)


Dixon, C. H. (Rutland)
Lorden, John William
Waring, major Walter


Doyle, N. Grattan
Lorimer, H. D.
Watts, Dr. T. (Man., Withington)


Du Pre, Colonel William Baring
Loyd, Arthur Thomas (Abingdon)
Wells, S. R.


Edmondson, Major A. J.
Lumley, L. R.
Weston, Colonel John Wakefield


Elliot, Capt. Walter E. (Lanark)
Macnaghten, Hon. Sir Malcolm
Wheler, Col. Granville C. H.


Ellis, R. G.
McNeill, Ronald (Kent, Canterbury)
White, Lt.-Col. G. D. (Southport)


Erskine, James Malcolm Monteith
Malone, Major P. B. (Tottenham, S.)
Whitla, Sir William


Erskine, Lord (Weston-super-Mare)
Margesson, H. D. R.
Wilson, Col. M. J. (Richmond)


Erskine-Bolst, Captain C.
Mason, Lieut.-Col. C. K.
Windsor-Clive, Lieut.-Colonel George


Eyres-Monsell, Com. Bolton M.
Mercer, Colonel H.
Winterton, Earl


Falcon, Captain Michael
Milne, J. S. Wardlaw
Wise, Frederick


Falle, Major Sir Bertram Godfray
Mitchell, W. F. (Saffron Walden)
Wolmer, Viscount


Fawkes, Major F. H.
Moore-Brabazon, Lieut.-Col. J. T. C.
Wood, Rt. Hn. Edward F. L. (Ripon)


Fermor-Hesketh, Major T.
Morden, Col. W. Grant
Wood, Sir H. K. (Woolwich, West)


Flanagan, W. H.
Murchison, C. K.
Wood, Maj. Sir S. Hill. (High Peak)


Ford, Patrick Johnston
Nesbitt, Robert C.
Woodcock, Colonel H. C.


Foreman, Sir Henry
Newman, Colonel J. R. P. (Finchley)
Worthington-Evans, Rt. Hon. Sir L.


Foxcroft, Captain Charles Talbot
Newman, Sir R. H. S. D. L. (Exeter)
Yerburgh, R. D. T.


Fremantle, Lieut.-Colonel Francis E.
Newson, Sir Percy Wilson



Furness, G. J.
Newton, Sir D. G. C. (Cambridge)
TELLERS FOR THE NOES.—


Galbraith, J. F. W.
Nicholson, Brig.-Gen. J. (Westminster)
Colonel Leslie Wilson and Colonel




Gibbs.

NEW CLAUSE.—(Extension of s. 52 of 10 and 11 Geo V., c. 18.)

Section fifty-two of Sub-section (2) of the Finance Act, 1920, shall be extended so as to exempt from Corporation Profits Tax companies formed for the purpose of operating and maintaining steam pilot cutters, and whose shareholders are working licensed pilots, when the earning of the pilots are limited by Statute.—[Mr. Gershom Stewart.]

Brought up, and read the First time.

Mr. GERSHOM STEWART: I beg to move, "That the Clause be read a Second time."
This New Clause is brought forward in the interests of a very worthy body of men, and it will not cost the Treasury much money. It deals with the Corporation Profits Tax, which is half dead, and which we hope will be quite dead before long. These pilots, on whose behalf the Clause is introduced, are treated as though they were a public company making profits for their shareholders who get money without working for it. These men have their own cutters, and sail their own ships by day and in the dead of night, in all weathers, to bring in the big ships which carry our foreign trade. When a pilot dies or retires from business his shares in the company pass on to another pilot and not to any outsider. I appeal for sympathetic consideration on the ground that this is a real example of co-partnership. It is not a question of a large speculative company. We are appealing on behalf of deserving individual seamen, and I ask the Financial Secretary to give the Clause his favourable consideration.

Major BURNIE: I beg to second the Motion.
All my life has been spent among men who go down to the sea in ships and have their business in great waters, and of all these men the pilot is, perhaps, the one most to be admired. The Corporation Profits Tax is levied upon limited companies. For reasons of their own, the pilots have formed their pilot cutter service into a limited company. When the Finance Act levied Corporation Profits Tax it was never intended that it should fall on public utility companies therefore, railway companies, canals and docks were specifically exempted. If the Chancellor of the Exchequer of that time had thought of the pilots, he would have
exempted them. Had the pilot cutters been under the docks companies they would have been exempt, because the docks companies have been exempted. I am sure that this matter only wants to be brought to the notice of the Financial Secretary to ensure that he will grant to the pilots this small concession, which will cost only a few hundred pounds.

Sir W. JOYNSON-HICKS: I am afraid that I shall have to be hardhearted again. My hon. Friend who moved this Amendment must not call it a small matter. A question of principle is involved. Companies are exempt if they have a limited dividend. Under the Act of 1920 certain companies are exempt, but they must be such as gas, water, electricity, tramway, dock, and canal companies who, by virtue of their constitution, are limited in their dividends. The pilot cutter companies—I do not know whether there is more than one; there may be two or three—are composed of pilots whose shares are not limited in dividend, and if the business of a pilot company is satisfactory they can be paid as large dividends as they can earn. Consequently they are not exempt under the Act of 1920. I had the constitution of one of these companies looked up at Somerset House, and there was no limit to their dividend, but if they liked to alter their constitution, so as to limit their dividends, then they would come under the exemption of the Act of 1920. But so long as their dividend paying power is unlimited I am afraid that they must come under the general law and pay Corporation Profits Duty.

Mr. ROYCE: It is almost useless occupying time appealing to the Treasury Bench to grant any exemption, but this is an illustration of how a man can change his disposition when he becomes a Minister. We knew the right hon. Gentleman in former days as hail fellow well met and brimming over with kindness.

Sir W. JOYNSON-HICKS: I am just the same now.

Mr. ROYCE: And now we find him hard-hearted when we make an appeal of this kind. If there are only one or two companies the collection of the amounts involved must cost more than the value of the amount collected. But this is the case of a small class of men whom few
Members of this House have not had the opportunity of admiring for their persistent devotion to duty. These men should be singled out for special benevolence. In no single instance have any members of their families ever become a burden on the poor rate or in any way received any assistance. The fact that they have made such provision for their families and dependants out of their own earnings is something which speaks strongly in their favour. The incomes of the great majority of these men are very small, in many cases they are regulated by statute law, and only a small number of them would come under the category described in this Amendment. Where singular instances do occur, I hope the Minister will make an exemption.

Mr. PRINGLE: I regret that the right hon. Gentleman has not seen his way to make this slight concession, which I would press upon him, in the unavoidable absence of my hon. and gallant Friend the Member for Central Hull (Lieut.-Commander Kenworthy). I think it is important that the case should be fully heard. It is perfectly true that this pilotage company does not come strictly within the meaning of the Section, because there is no limitation upon the

dividends, but the right hon. Gentleman must admit that this is only a technical difference. The shares are all held by the pilots, and, as servants of the company, their salaries are limited. There is a definite limitation of their salaries, but the company in itself is merely a profit-sharing institution, in which the pilots themselves are the shareholders. It is quite different from a public company, wherein the shares are held by people outside, who benefit by any increase in dividend. In this case it merely represents a means of sharing the profits among the men themselves, and, in that sense, I do not think it is outside the spirit of the Section. If these pilots decided to raise their salaries, so that there would be no dividend, or only a fixed dividend payable, their case could be brought strictly within the limits of the Statute. This is only a technical variation of the principle included in the original Act, and the Treasury should consider the special circumstances of the case, and bring it within the purview of the exemption.

Question put, "That the Clause be read a Second time."

The House divided: Ayes, 144; Noes, 248.

Division No. 262.]
AYES.
[10.29 p.m.


Alexander, A. V. (Sheffield, Hillsbro')
Falconer, J.
Lansbury, George


Ammon, Charles George
Foot, Isaac
Lawson, John James


Attlee, C. R.
Gosling, Harry
Leach, W.


Barker, G. (Monmouth, Abertillery)
Graham, D. M. (Lanark, Hamilton)
Lee, F.


Barrie, Sir Charles Coupar (Banff)
Greenall, T.
Lees-Smith, H. B. (Keighley)


Batey, Joseph
Greenwood, A. (Nelson and Colne)
Linfield, F. C.


Benn, Captain Wedgwood (Leith)
Grenfell, D. R. (Glamorgan)
Lowth, T.


Bennett, A. J. (Mansfield)
Griffiths, T. (Monmouth, Pontypool)
Lunn, William


Berkeley, Captain Reginald
Groves, T.
MacDonald, J. R. (Aberavon)


Bonwick, A.
Grundy, T. W.
M'Entee, V. L.


Bowdler, W. A.
Hall, F. (York, W. R., Normanton)
McLaren, Andrew


Bowerman, Rt. Hon. Charles W.
Hall, G. H. (Merthyr Tydvil)
Macnamara, Rt. Hon. Dr. T. J.


Broad, F. A.
Hamilton, Sir R. (Orkney & Shetland)
March, S.


Brotherton, J.
Hardie, George D.
Marshall, Sir Arthur H.


Brown, James (Ayr and Bute)
Harney, E. A.
Martin, F. (Aberd'n & Kinc'dine, E.)


Buckie, J.
Harris, Percy A.
Middleton, G.


Burgess, S.
Hastings, Patrick
Morel, E. D.


Butler, J. R. M. (Cambridge Univ.)
Hay, Captain J. P. (Cathcart)
Morrison, R. C. (Tottenham, N.)


Buxton, Charles (Accrington)
Hayday, Arthur
Mosley, Oswald


Buxton, Noel (Norfolk, North)
Hayes, John Henry (Edge Hill)
Murnin, H.


Chadwick, Sir Robert Burton
Henderson, Rt. Hon. A. (N'castle, E.)
Murray, John (Leeds, West)


Chapple, W. A.
Herriotts, J.
O'Grady, Captain James


Charleton, H. C.
Hill, A.
Oliver, George Harold


Clarke, Sir E. C.
Hillary, A. E.
Paling, W.


Collins, Pat (Walsall)
Hinds, John
Parkinson, John Allen (Wigan)


Collison, Levi
Hirst, G. H.
Phillipps, Vivian


Cotts, Sir William Dingwall Mitchell
Jenkins, W. (Glamorgan, Neath)
Ponsonby, Arthur


Darbishire, C. W.
Jenkins, W. A. (Brecon and Radnor)
Potts, John S.


Davies, Evan (Ebbw Vale)
John, William (Rhondda, West)
Pringle, W. M. R.


Davies, Rhys John (Westhoughton)
Johnston, Thomas (Stirling)
Rae, Sir Henry N.


Davison, J. E. (Smethwick)
Jones, Henry Haydn (Merioneth)
Richardson, Sir Alex. (Gravesend)


Duffy, T. Gavan
Jones, Morgan (Caerphilly)
Riley, Ben


Dunnico, H.
Jones, R. T. (Carnarvon)
Ritson, J.


Ede, James Chuter
Jones, T. I. Mardy (Pontypridd)
Roberts, Frederick O. (W. Bromwich)


Edmonds, G.
Jewitt, W. A. (The Hartlepools)
Robertson, J. (Lanark, Bothwell)


Edwards, C. (Monmouth, Bedwellty)
Kenyon, Barnet
Royce, William Stapleton


Entwistle, Major C. F.
Lambert, Rt. Hon. George
Saklatvala, S.


Salter Dr. A.
Sullivan, J.
Whiteley, W.


Sexton, James
Thomas, Sir Robert John (Anglesey)
Williams, David (Swansea, E.)


Shaw, Thomas (Preston)
Thomson, T. (Middlesbrough, West)
Williams, Dr. J. H. (Llanelly)


Short, Alfred (Wednesbury)
Thorne, W. (West Ham, Plaistow)
Williams, T. (York, Don Valley)


Simpson, J. Hope
Trevelyan, C. P.
Wilson, C. H. (Sheffield, Attercliffe)


Sitch, Charles H.
Turner, Ben
Wintringham, Margaret


Snell, Harry
Walsh, Stephen (Lancaster, Ince)
Wood, Major M. M. (Aberdeen, C.)


Snowden, Phillip
Watson, W. M. (Dunfermline)
Wright, W.


Spencer, George A. (Broxtowe)
Watts-Morgan, Lt.-Col. D. (Rhondda)
Young, Robert (Lancaster, Newton)


Stephenson, Lieut.-Colonel H. K.
Weir, L. M.



Stewart, J. (St. Rollox)
Westwood, J.
TELLERS FOR THE AYES.—


Strauss, Edward Anthony
White, Charles F. (Derby, Western)
Mr. Gershom Stewart and Major




Burnie.


NOES.


Agg-Gardner, Sir James Tynte
Ednam, Viscount
Lamb, J. Q.


Alexander, E. E. (Leyton, East)
Elliot, Capt. Walter E. (Lanark)
Lane-Fox, Lieut.-Colonel G. R.


Alexander, Col. M. (Southwark)
Ellis, R. G.
Leigh, Sir John (Clapham)


Archer-Shee, Lieut.-Colonel Martin
Erskine, James Malcolm Monteith
Lloyd, Cyril E. (Dudley)


Ashley, Lt.-Col. Wilfrid W.
Erskine, Lord (Weston-super-Mare)
Locker-Lampson, G. (Wood Green)


Baldwin, Rt. Hon. Stanley
Evans, Capt. H. Arthur (Leicester, E.)
Locker-Lampson, Com. O. (Handsw'th)


Balfour, George (Hampstead)
Eyres-Monsell, Com. Bolton M.
Lorden, John William


Banbury, Rt. Hon. Sir Frederick G.
Falcon, Captain Michael
Lorimer, H. D.


Banks, Mitchell
Falle, Major Sir Bertram Godfray
Loyd, Arthur Thomas (Abingdon)


Barnett, Major Richard W.
Fawkes, Major F. H.
Lumley, L. R.


Barnston, Major Harry
Fermor-Hesketh, Major T.
Macnaghten, Hon. Sir Malcolm


Becker, Harry
Flanagan, W. H.
McNeill, Ronald (Kent, Canterbury)


Bell, Lieut.-Col. W. C. H. (Devizes)
Ford, Patrick Johnston
Malone, Major P. B. (Tottenham, S.)


Benn, Sir A. S. (Plymouth, Drake)
Foreman, Sir Henry
Margesson, H. D. R.


Bennett, Sir T. J. (Sevenoaks)
Foxcroft, Captain Charles Talbot
Mason, Lieut.-Col. C. K.


Bentinck, Lord Henry Cavendish.
Fremantle, Lieut.-Colonel Francis E.
Mercer, Colonel H.


Berry, Sir George
Furness, G. J.
Milne, J. S. Wardlaw


Betterton, Henry B.
Galbraith, J. F. W.
Mitchell, W. F. (Saffron Walden)


Birchall, Major J. Dearman
Ganzoni, Sir John
Mitchell, Sir W. Lane (Streatham)


Bird, Sir William B. M. (Chichester)
Garland, C. S.
Moore-Brabazon, Lieut.-Col. J. T. C.


Blades, Sir George Rowland
Gates, Percy
Morden, Col. W. Grant


Bowyer, Capt. G. E. W.
Gaunt, Rear-Admiral Sir Guy R.
Moreing, Captain Algernon H.


Boyd-Carpenter, Major A.
Gilmour, Lt.-Col. Rt. Hon. Sir John
Morrison-Bell, Major A. C. (Honiton)


Brass, Captain W.
Gould, James C.
Murchison, C. K.


Bridgeman, Rt. Hon. William Clive
Greaves-Lord, Walter
Nesbitt, Robert C.


Brittain, Sir Harry
Greene, Lt.-Col. Sir W. (Hack'y, N.)
Newman, Colonel J. R. P. (Finchley)


Brown, Major D. C. (Hexham)
Grenfell, Edward C. (City of London)
Newman, Sir R. H. S. D. L. (Exeter)


Brown, Brig.-Gen. Clifton (Newbury)
Gretton, Colonel John
Newson, Sir Percy Wilson


Bruton, Sir James
Guinness, Lieut.-Col. Hon. W. E.
Newton, Sir D. G. C. (Cambridge)


Buckingham, Sir H.
Gwynne, Rupert S.
Nicholson, Brig.-Gen. J. (Westminster)


Burn, Colonel Sir Charles Rosdew
Hacking, Captain Douglas H.
Nicholson, William G. (Petersfield)


Burney, Com. (Middx., Uxbridge)
Hall, Lieut.-Col. Sir F. (Dulwich)
O'Neill, Rt. Hon. Hugh


Butcher, Sir John George
Hall, Rr-Adml Sir W. (Liv'p'l, W. D'by)
Ormsby-Gore. Hon. William


Butler, H. M. (Leeds, North)
Halstead, Major D.
Paget, T. G.


Butt, Sir Alfred
Hamilton, Sir George C. (Aitrincham)
Parker, Owen (Kettering)


Button, H. S.
Hannon, Patrick Joseph Henry
Pattinson, S. (Horncastle)


Cadogan, Major Edward
Harmsworth, Hon. E. C. (Kent)
Pease, William Edwin


Campion, Lieut.-Colonel W. R.
Harrison, F. C.
Pennefather, De Fonblanque


Cautley, Henry Strother
Harvey, Major S. E.
Penny, Frederick George


Cayzer, Sir C. (Chester, City)
Hawke, John Anthony
Perkins, Colonel E. K.


Cecil, Rt. Hon. Sir Evelyn (Aston)
Hay, Major T. W. (Norfolk, South)
Perring, William George


Cecil, Rt. Hon. Lord H. (Ox. Univ.)
Henn, Sir Sydney H.
Philipson, Mabel


Chamberlain, Rt. Hn. J. A. (Birm., W.)
Hennessy, Major J. R. G.
Pollock, Rt. Hon. Sir Ernest Murray


Chamberlain, Rt. Hon. N. (Ladywood)
Herbert, Dennis (Hertford, Watford)
Pownall, Lieut.-Colonel Assheton


Churchman, Sir Arthur
Hewett, Sir J. P.
Pretyman, Rt. Hon. Ernest G.


Clarry, Reginald George
Hilder, Lieut.-Colonel Frank
Privett, F. J.


Clayton, G. C.
Hiley, Sir Ernest
Raine, W.


Cobb, Sir Cyril
Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Rankin, Captain James Stuart


Cockerill, Brigadier-General G. K.
Hogg, Rt. Hon. Sir D. (St. Marylebone)
Rawlinson, Rt. Hon. John Fredk. Peel


Colfox, Major Wm. Phillips
Hohler, Gerald Fitzroy
Rees, Sir Beddoe


Colvin, Brig.-General Richard Beale
Holbrook, Sir Arthur Richard
Reid, D. D. (County Down)


Conway, Sir W. Martin
Hood, Sir Joseph
Remer, J. R.


Cope, Major William
Hopkins, John W. W.
Remnant, Sir James


Craig, Captain C. C. (Antrim, South)
Hopkinson, A. (Lancaster, Mossley)
Rhodes, Lieut.-Col. J. P.


Croft, Lieut.-Colonel Henry Page
Houfton, John Plowright
Richardson, Lt.-Col. Sir P. (Chertsey)


Crook, C. W. (East Ham, North)
Hudson, Capt. A.
Roberts, Samuel (Hereford, Hereford)


Crooke, J. Smedley (Deritend)
Hunter-Weston, Lt.-Gen. Sir Aylmer
Robertson-Despencer, Major (Islgtn, W.)


Curzon, Captain Viscount
Hurd, Percy A.
Roundell, Colonel R. F.


Dalziel, Sir D. (Lambeth, Brixton)
Hutchison, G. A. C. (Midlothian, N.)
Ruggles-Brise, Major E.


Davidson, J. C. C. (Hemel Hempstead)
Inskip, Sir Thomas Walker H.
Russell-Wells, Sir Sydney


Davidson, Major-General Sir J. H.
Jackson, Lieut.-Colonel Hon. F. S.
Samuel, A. M. (Surrey, Farnham)


Davies, Alfred Thomas (Lincoln)
Jephcott, A. R.
Samuel, Samuel (W'dsworth, Putney)


Davison, Sir W. H. (Kensington, S.)
Jodrell, Sir Neville Paul
Sanderson, Sir Frank B.


Dawson, Sir Phillip
Johnson, Sir L. (Walthamstow, E.)
Sandon, Lord


Dixon, C. H. (Rutland)
Joynson-Hicks, Sir William
Scott, Sir Leslie (Liverp'l, Exchange)


Doyle, N. Grattan
Kelley, Major Fred (Rotherham)
Shaw, Hon. Alex. (Kilmarnock)


Du Pre, Colonel William Baring
Kennedy, Captain M. S. Nigel
Shepperson, E. W.


Edge, Captain Sir William
King, Captain Henry Douglas
Shipwright, Captain D.


Edmondson, Major A. J.
Kinloch-Cooke, Sir Clement
Simpson-Hinchliffe, W. A.




Skelton, A. N.
Titchfield, Marquess of
Winterton, Earl


Smith, Sir Harold (Wavertree)
Tryon, Rt. Hon. George Clement
Wise, Frederick


Somerville, A. A. (Windsor)
Tubbs, S. W.
Wolmer, Viscount


Somerville, Daniel (Barrow-in-Furness)
Turton, Edmund Russborough
Wood, Rt. Hn. Edward F. L. (Ripon)


Stanley, Lord
Wallace, Captain E.
Wood, Sir H. K. (Woolwich, West)


Steel, Major S. Strang
Ward, Col. L. (Kingston-upon-Hull)
Wood, Maj. Sir S. Hill- (High Peak)


Stott, Lt.-Col. W. H.
Waring, Major Walter
Woodcock, Colonel H. C.


Sueter, Rear-Admiral Murray Fraser
Watts, Dr. T. (Man., Withington)
Worthington-Evans, Rt. Hon. Sir L.


Sugden, Sir Wilfred H.
Wells, S. R.
Yate, Colonel Sir Charles Edward


Sutherland, Rt. Hon. Sir William
Weston, Colonel John Wakefield
Yerburgh, R. D. T.


Sykes, Major-Gen. Sir Frederick H.
White, Lt.-Col. G. D. (Southport)
Young, Rt. Hon. E. H. (Norwich)


Thompson, Luke (Sunderland)
Whitla, Sir William



Thomson, F. C. (Aberdeen, S.)
Wilson, Col. M. J. (Richmond)
TELLERS FOR THE NOES.—


Thornton, M.
Windsor-Clive, Lieut.-Colonel George
Colonel Leslie Wilson and Colonel



Winfrey, Sir Richard
Gibbs.

The following proposed New Clause (Rebate to be granted on articles used in agriculture) stood on the Order Paper in the name of Captain Wedgwood Benn:
Where it is shown to the satisfaction of the Commissioners of Customs and Excise that any non-excisable article on which an import duty has been charged is to be used directly or indirectly in the agricultural industry, a rebate equal to the amount of the duty paid shall be made to the importer.

Mr. SPEAKER: Major McKenzie Wood—

Captain BENN: May I direct your attention, Sir, to the new Clause which stands in my name and that of other hon. Members, on the Order Paper? May I ask whether you will see your way to permit a Division to be taken on it? I am anxious for that, although I am not anxious to explain it at length. The matter was not raised on the Committee stage, and the point, I think, is one of some substance.

Mr. SPEAKER: I am afraid I cannot accede to the request of the hon. and gallant Gentleman. Perhaps my intimation did not reach him. The matter was dealt with at an earlier stage of the Session, and certainly we could not take it up now.

Mr. PRINGLE: On a point of Order. May I submit to you, Sir, that this proposed new Clause raises a different issue to that raised in the Bill? The Bill relates solely to the Safeguarding of Industries Act. This relates to the duties of Customs and Excise generally falling upon agricultural produce. It therefore raises a general question of principle. In these circumstances, might I, with respect, submit that the House should have an opportunity of recording a decision?

Mr. SPEAKER: Perhaps I was wrong in my reference to the hon. and gallant
Member's Bill. I have carefully considered the matter, and I cannot see my way to select the proposed new Clause.

NEW CLAUSE.—(Relief in respect of certain insurance policies in Scotland.)

A sinking fund or capital redemption policy issued by a registered insurance company in Scotland shall be treated for Inland Revenue purposes under the same category as a similar policy issued by a registered insurance company in England.—[Major McKenzie Wood.]

Brought up, and read the First time.

Major McKENZIE WOOD: I beg to move, "That the Clause be read a Second time."
I moved this Clause in Committee, and the Solicitor-General waxed rather facetious on that occasion. I hope he will not do so on this occasion, because my Amendment is a serious one, and I trust he will take it seriously. It is meant to deal with a real grievance. The case I brought to the notice of hon. Members was where, in an insurance policy issued by an insurance company in Scotland, the stamp duty payable was £31 5s., whereas the stamp duty on a similar policy issued by a company in England was only 6d. The Solicitor-General said that that was due to the interpretation of the Scottish Courts as to what actually it cost to make a bond in Scotland. That only states what is the cause of this anomaly; it does not deal with the question I am raising as to whether there is any real ground for the anomaly, and whether there might not be a remedy for it. I put down my Amendment to insure that in future, for this particular purpose of revenue, no difference should be entertained between an insurance policy of this kind whether it be issued by a Scottish company or by an English company. It is, obviously, very prejudicial to Scottish insurance companies if policies
issued by them are to be mulcted to this extent as compared with England. For my own part I see no justification for that course at all. I hope, therefore, that the Government will see fit to accept this Amendment, or, at any rate, if they do not they will give us some solid reason for differentiating so unfairly against Scotland and Scottish insurance companies.

Mr. MARTIN: I beg to second the Motion.

The SOLICITOR - GENERAL: This Clause was proposed on the last occasion at an hour of the night which precluded any adequate reply. I must say what I tried to say before on this point, that it depends upon the admirable system of law which prevails in Scotland as to whether the document referred to in the Amendment is a bond or not. According to Scottish law certain documents are bonds which in English law are not bonds, and it is not for me to say which is the best system. The fact of the matter is that bonds are taxed at a particular rate. The particular document which the hon. and gallant Member indicates in his Amendment is in Scotland held to be a bond, whilst in England it would not be held to be a bond. I am afraid that the hon. and gallant Gentleman (Major M. Wood) must devise some other method of bringing the law of Scotland into conformity with the law of England than by the proposal which he now makes. The difference is due to the fact that in Scotland an instrument securing the payment of a sum of money is a bond, even if given under hand only, while in England it is only a bond if it is given under seal. If the hon. and gallant Gentleman will make the law of Scotland agreeable to the law of England, I am afraid these documents must be taxed differently. Probably he is not satisfied with this answer, but if there is an anomaly, and attention has been called to it quite recently, some consideration will be given to see whether on some future occasion the anomaly, if it be a real anomaly, can be removed.

Mr. PRINGLE: Although the Solicitor-General has succeeded in not being facetious to-night, he has not succeeded in being any more satisfactory. He has not dealt with the position as stated by
my hon. Friend the Member for Central Aberdeen (Major M. Wood). He has shown that an anomaly does exist from the revenue point of view, and that a legal document is treated by the Revenue Authorities in one way in England, while it is treated in a different way in Scotland. That is entirely due to the technicality that a bond in England must be under seal, but it is not so in Scotland. Surely, it is the object of the revenue to tax subjects equally in both countries. If it does not do so, then the revenue is acting unjustly. The hon. and learned Gentleman has offered no defence at all; he has not even dealt with the proposition that the new Clause would provide a remedy. He does not suggest that it does not. He has, in effect, admitted the existence of the anomaly due to the difference in the laws of the two countries. Yet here is a Clause which sets it right and he has nothing to say about it. I should like to have the Front Bench reinforced by a Law Officer from Scotland. We all know the great importance that was attached to the accession of the learned Solicitor-General for Scotland, and we are surprised and disappointed the House should not have the benefit of illumination from him on an obscure problem of this kind. It is regrettable the Government should have made no attempt to remove this inequality of the law which inflicts a great injustice on the Scottish taxpayer, and that it should have given no reason for rejecting the Clause of my hon. Friend which offers a means of doing it. I hope my hon. Friend will divide the House and thus enable it to express its opinion of the slackness and inefficiency of the Solicitor-General and the Financial Secretary in dealing with an important grievance of this kind.

Mr. FALCONER: If documents identical in England and Scotland have different legal effects it is the duty of the Treasury to make its taxation uniform, even if one course has to be taken for England and another for Scotland. Here we have a real grievance for Scotland, and it should be remedied by the Government and not be left to private Members to deal with by bringing in Bills to amend the existing law. It is up to the Financial Secretary to the Treasury to see that the taxation is levied in such a way that injustice cannot arise.

Question put, "That the Clause be read a Second time."

The House divided: Ayes, 148; Noes, 255.

Division No. 263.]
AYES.
[10.50 p.m.


Alexander, A. V. (Sheffield, Hillsbro')
Hamilton, Sir R. (Orkney & Shetland)
Phillipps, Vivian


Ammon, Charles George
Hardie, George D.
Ponsonby, Arthur


Attlee, C. R.
Harney, E. A.
Potts, John S.


Barker, G. (Monmouth, Abertillery)
Harris, Percy A.
Pringle, W. M. R.


Barrie, Sir Charles Coupar (Banff)
Hastings, Patrick
Riley, Ben


Batey, Joseph
Hay, Captain J. P. (Cathcart)
Ritson, J.


Benn, Captain Wedgwood (Leith)
Hayday, Arthur
Roberts, C. H. (Derby)


Bennett, A. J. (Mansfield)
Hayes, John Henry (Edge Hill)
Roberts, Frederick O. (W. Bromwich)


Berkeley, Captain Reginald
Henderson, Rt. Hon. A. (N'castle, E.)
Robertson, J. (Lanark, Bothwell)


Bonwick, A.
Herriotts, J.
Royce, William Stapleton


Bowdler, W. A.
Hill, A.
Saklatvala, S.


Bowerman, Rt. Hon. Charles W.
Hinds, John
Salter, Dr. A.


Broad, F. A.
Hirst, G. H.
Sexton, James


Brotherton, J.
Jenkins, W. (Glamorgan, Neath)
Shaw, Thomas (Preston)


Brown, James (Ayr and Bute)
John, William (Rhondda, West)
Short, Alfred (Wednesbury)


Buckie, J.
Johnston, Thomas (Stirling)
Simon, Rt. Hon. Sir John


Burgess, S.
Jones, Henry Haydn (Merioneth)
Simpson, J. Hope


Burnie, Major J. (Bootle)
Jones, J. J. (West Ham, Silvertown)
Sitch, Charles H.


Buxton, Charles (Accrington)
Jones, Morgan (Caerphilly)
Snell, Harry


Buxton, Noel (Norfolk, North)
Jones, R. T. (Carnarvon)
Spencer, George A. (Broxtowe)


Charleton, H. C.
Jones, T. I. Mardy (Pontypridd)
Stephenson, Lieut.-Colonel H. K.


Clarke, Sir E. C.
Jowett, F. W. (Bradford, East)
Stewart, J. (St. Rollox)


Clynes, Rt. Hon. John R.
Jowitt, W. A. (The Hartlepools)
Strauss, Edward Anthony


Collins, Pat (Walsall)
Kenyon, Barnet
Sullivan, J.


Collison, Levi
Lambert, Rt. Hon. George
Sutherland, Rt. Hon. Sir William


Cotts, Sir William Dingwall Mitchell
Lansbury, George
Thomas, Sir Robert John (Anglesey)


Darbishire, C. W.
Lawson, John James
Thomson, T. (Middlesbrough, West)


Davies, Evan (Ebbw Vale)
Leach, W.
Thorne, W. (West Ham, Plaistow)


Davies, Rhys John (Westhoughton)
Lee, F.
Thornton, M.


Davison, J. E. (Smethwick)
Lees-Smith, H. B. (Keighley)
Trevelyan, C. P.


Dudgeon, Major C. R.
Linfield, F. C.
Turner, Ben


Duffy, T. Gavan
Lowth, T.
Walsh, Stephen (Lancaster, Ince)


Dunnico, H.
Lunn, William
Watson, W. M. (Dunfermline)


Ede, James Chuter
MacDonald, J. R. (Aberavon)
Watts-Morgan, Lt.-Col. D. (Rhondda)


Edge, Captain Sir William
M'Entee, V. L.
Webb, Sidney


Edmonds, G.
McLaren, Andrew
Weir, L. M.


Edwards, C. (Monmouth, Bedwellty)
March, S.
Westwood, J.


Entwistle, Major C. F.
Marshall, Sir Arthur H.
White, Charles F. (Derby, Western)


Falconer, J.
Martin, F. (Aberd'n & Kinc'dine, E.)
Whiteley, W.


Foot, Isaac
Middleton, G.
Williams, David (Swansea, E.)


Gosling, Harry
Morel, E. D.
Williams, Dr. J. H. (Llanelly)


Graham, D. M. (Lanark, Hamilton)
Morrison, R. C. (Tottenham, N.)
Williams, T. (York, Don Valley)


Greenall, T.
Mosley, Oswald
Wilson, C. H. (Sheffield, Attercliffe)


Greenwood, A. (Nelson and Colne)
Murnin, H.
Wintringham, Margaret


Grenfell, D. R. (Glamorgan)
Murray, John (Leeds, West)
Wright, W.


Griffiths, T. (Monmouth, Pontypool)
O'Grady, Captain James
Young, Robert (Lancaster, Newton)


Groves, T.
Oliver, George Harold



Grundy, T. W.
Paling, W.
TELLERS FOR THE AYES.—


Guest, Hon. C. H. (Bristol, N.)
Parkinson, John Allen (Wigan)
Major McKenzie Wood and Mr. A.


Hall, F. (York, W. R., Normanton)
Parry, Lieut.-Colonel Thomas Henry
Shaw.


Hall, G. H. (Merthyr Tydvil)
Pattinson, S. (Horncastle)



NOES.


Agg-Gardner, Sir James Tynte
Bowyer, Capt. G. E. W.
Churchman, Sir Arthur


Alexander, E. E. (Leyton, East)
Boyd-Carpenter, Major A.
Clarry, Reginald George


Alexander, Col. M. (Southwark)
Brass, Captain W.
Clayton, G. C.


Apsley, Lord
Bridgeman, Rt. Hon. William Clive
Cobb, Sir Cyril


Archer-Shee, Lieut.-Colonel Martin
Brittain, Sir Harry
Cockerill, Brigadier-General G. K.


Ashley, Lt.-Col. Wilfrid W.
Brown, Major D. C. (Hexham)
Colfox, Major Wm. Phillips


Baldwin, Rt. Hon. Stanley
Brown, Brig.-Gen. Clifton (Newbury)
Colvin, Brig.-General Richard Beale


Balfour, George (Hampstead)
Bruton, Sir James
Conway, Sir W. Martin


Banbury, Rt. Hon. Sir Frederick G.
Buckingham, Sir H.
Cope, Major William


Banks, Mitchell
Burn, Colonel Sir Charles Rosdew
Craig, Captain C. C. (Antrim, South)


Barlow, Rt. Hon. Sir Montague
Burney, Com. (Middx., Uxbridge)
Croft, Lieut.-Colonel Henry Page


Barnett, Major Richard W.
Butcher, Sir John George
Crook, C. W. (East Ham, North)


Barnston, Major Harry
Butler, H. M. (Leeds, North)
Crooke, J. Smedley (Deritend)


Becker, Harry
Butt, Sir Alfred
Curzon, Captain Viscount


Bell, Lieut.-Col. W. C. H. (Devizes)
Button, H. S.
Dalziel, Sir D. (Lambeth, Brixton)


Bellairs, Commander Carlyon W.
Cadogan, Major Edward
Davidson, J. C. C. (Hemel Hempstead)


Benn, Sir A. S. (Plymouth, Drake)
Campion, Lieut.-Colonel W. R.
Davidson, Major-General Sir J. H.


Bennett, Sir T. J. (Sevenoaks)
Cautley, Henry Strother
Davies, Alfred Thomas (Lincoln)


Bentinck, Lord Henry Cavendish
Cayzer, Sir C. (Chester, City)
Davison, Sir W. H. (Kensington, S.)


Berry, Sir George
Cecil, Rt. Hon. Sir Evelyn (Aston)
Dawson, Sir Philip


Betterton, Henry B.
Cecil, Rt. Hon. Lord H. (Ox. Univ.)
Dixon, C. H. (Rutland)


Birchall, Major J. Dearman
Chadwick, Sir Robert Burton
Doyle, N. Grattan


Bird, Sir William B. M. (Chichester)
Chamberlain, Rt. Hon. J. A. (Birm., W.)
Du Pre, Colonel William Baring


Blades, Sir George Rowland
Chamberlain, Rt. Hon. N. (Ladywood)
Edmondson, Major A. J.


Ednam, Viscount
Jephcott, A. R.
Rhodes, Lieut.-Col. J. P.


Elliot, Capt. Walter E. (Lanark)
Jodrell, Sir Neville Paul
Richardson, Sir Alex. (Gravesend)


Ellis, R. G.
Johnson, Sir L. (Walthamstow, E.)
Richardson, Lt.-Col. Sir P. (Chertsey)


Erskine, James Malcolm Monteith
Joynson-Hicks, Sir William
Roberts, Samuel (Hereford, Hereford)


Erskine, Lord (Weston-super-Mare)
Kelley, Major Fred (Rotherham)
Robertson-Despencer, Major (Islgtn, W.)


Evans, Capt. H. Arthur (Leicester, E.)
Kennedy, Captain M. S. Nigel
Roundell, Colonel R. F.


Eyres-Monsell, Com. Bolton M.
King, Captain Henry Douglas
Ruggles-Brise, Major E.


Falcon, Captain Michael
Kinloch-Cooke, Sir Clement
Russell, William (Bolton)


Falle, Major Sir Bertram Godfray
Lamb, J. Q.
Russell-Wells, Sir Sydney


Fawkes, Major F. H.
Lane-Fox, Lieut.-Colonel G. R.
Samuel, A. M. (Surrey, Farnham)


Fermor-Hesketh, Major T.
Leigh, Sir John (Clapham)
Samuel, Samuel (W'dsworth, Putney)


Flanagan, W. H.
Lloyd, Cyril E. (Dudley)
Sanderson, Sir Frank B.


Ford, Patrick Johnston
Lloyd-Greame, Rt. Hon. Sir P.
Sandon, Lord


Foreman, Sir Henry
Locker-Lampson, G. (wood Green)
Sassoon, Sir Philip Albert Gustave D.


Foxcroft, Captain Charles Talbot
Locker-Lampson, Com O. (Handsw'th)
Scott, Sir Leslie (Liverp'l, Exchange)


Fremantle, Lieut.-Colonel Francis E.
Lorden, John William
Shepperson, E. W.


Furness, G. J.
Lorimer, H. D.
Shipwright, Captain D.


Galbraith, J. F. W.
Loyd, Arthur Thomas (Abingdon)
Simpson-Hinchliffe, W. A.


Ganzoni, Sir John
Lumley, L. R.
Skelton, A. N.


Garland, C. S.
McNeill, Ronald (Kent, Canterbury)
Smith, Sir Allan M. (Croydon, South)


Gates, Percy
Malone, Major P. B. (Tottenham, S.)
Snowden, Philip


Gaunt, Rear-Admiral Sir Guy R.
Margesson, H. D. R.
Somerville, A. A. (Windsor)


Gilmour, Lt.-Col. Rt. Hon. Sir John
Mason, Lieut.-Col. C. K.
Somerville, Daniel (Barrow-in-Furness)


Greaves-Lord, Walter
Mercer, Colonel H.
Spender-Clay, Lieut.-Colonel H. H.


Greene, Lt.-Col. Sir W. (Hack'y, N.)
Milne, J. S. Wardlaw
Stanley, Lord


Grenfell, Edward C. (City of London)
Mitchell, W. F. (Saffron Walden)
Steel, Major S. Strang


Gretton, Colonel John
Mitchell, Sir W. Lane (Streatham)
Stewart, Gershom (Wirral)


Guinness, Lieut.-Col Hon. W. E.
Moore-Brabazon, Lieut.-Col. J. T. C.
Stott, Lt.-Col. W. H.


Gwynne, Rupert S.
Morden, Col. W. Grant
Sueter, Rear-Admiral Murray Fraser


Hacking, Captain Douglas H.
Moreing, Captain Algernon H.
Sugden, Sir Wilfrid H.


Hall, Lieut.-Col. Sir F. (Dulwich)
Morrison-Bell, Major A. C. (Honiton)
Sykes, Major-Gen. Sir Frederick H.


Hall, Rr-Adml Sir W. (Liv'p'l, W. D.'by
Murchison, C. K.
Thompson, Luke (Sunderland)


Halstead, Major D.
Nall, Major Joseph
Thomson, F. C. (Aberdeen, South)


Hamilton, Sir George C. (Altrincham)
Nesbitt, Robert C.
Titchfield, Marquess of


Hannon, Patrick Joseph Henry
Newman, Colonel J. R. P. (Finchley)
Tryon, Rt. Hon. George Clement


Harmswoth, Hon. E. C. (Kent)
Newman, Sir R. H. S. D. L. (Exeter)
Tubbs, S. W.


Harrison, F. C.
Newson, Sir Percy Wilson
Turton, Edmund Russborough


Harvey, Major S. E.
Newton, Sir D. G. C. (Cambridge)
Wallace, Captain E.


Hawke, John Anthony
Nicholson, Brig.-Gen. J. (Westminster)
Ward, Col. L. (Kingston-upon-Hull)


Hay, Major T. W. (Norfolk, South)
Nicholson, William G. (Petersfield)
Waring, Major Walter


Henn, Sir Sydney H.
O'Neill, Rt. Hon. Hugh
Watts, Dr. T. (Man., Withington)


Hennessy, Major J. R. G.
Ormsby-Gore, Hon. William
Wells, S. R.


Herbert, Dennis (Hertford, Watford)
Paget, T. G.
Weston, Colonel John Wakefield


Hewett, Sir J. P.
Parker, Owen (Kettering)
Wheler, Col. Granville C. H.


Hilder, Lieut.-Colonel Frank
Pease, William Edwin
White, Lt.-Col. G. D. (Southport)


Hiley, Sir Ernest
Pennefather, De Fonblanque
Whitla, Sir William


Hoare, Lt.-Col. Rt. Hon. Sir S. J. G.
Penny, Frederick George
Wilson, Col. M. J. (Richmond)


Hohler, Gerald Fitzroy
Perkins, Colonel E. K.
Winterton, Earl


Holbrook, Sir Arthur Richard
Perring, William George
Wise, Frederick


Hood, Sir Joseph
Philipson, Mabel
Wolmer, Viscount


Hopkins, John W. W.
Pollock, Rt. Hon. Sir Ernest Murray
Wood, Rt. Hn. Edward F. L. (Ripon)


Hopkinson, A. (Lancaster, Mossley)
Pownall, Lieut.-Colonel Assheton
Wood, Sir H. K. (Woolwich, West)


Houfton, John Plowright
Pretyman, Rt. Hon. Ernest G.
Wood, Maj. Sir S. Hill. (High Peak)


Hundson, Capt. A.
Privett, F. J.
Woodcock, Colonel, H. C.


Hume, G. H.
Raine, W.
Worthington Evans, Rt. Hon. Sir L.


Hunter-Weston, Lt.-Gen. Sir Aylmer
Rankin, Captain James Stuart
Yate, Colonel Sir Charles Edward


Hurd, Percy A.
Rawlinson, Rt. Hon. John Fredk. Peel
Yerburgh, R. D. T.


Hutchison, G. A. C. (Midlothian, N.)
Rees, Sir Beddoe



Inskip, Sir Thomas Walker H.
Reid, D. D. (County Down)
TELLERS FOR THE NOES.—


Jackson, Lieut.-Colonel Hon. F. S.
Remer, J. R.
Colonel Leslie Wilson and Colonel


Jenkins, W. A. (Brecon and Radnor)
Remnant, Sir James
Gibbs.


Question, "That the Clause be read a Second time," put, and agreed to.

NEW CLAUSE.—(Drawback on manufactured coffee for export.)

(1) If it is proved to the satisfaction of the Commissioners of Customs and Excise that any roasted coffee in respect of which the duties of Customs payable thereon have been duly paid has been used in Great Britain or Northern Ireland in the manufacture or preparation of any goods exported or shipped for use as stores, there shall, subject to such conditions as the Commissioners may prescribe, be allowed in respect of the quantity of roasted coffee which appears to the satisfaction of the Treasury to have been used in the manufacture or preparation of the goods a drawback equal to the drawback which would be payable upon the exportation of the same quantity of roasted coffee.
200
(2) This Section shall apply to roasted chicory and to mixtures of roasted coffee and roasted chicory as it applies to roasted coffee, with the substitution of the words "duties of Customs or Excise" for the words "duties of Customs."
(3) In allowing drawback under this Section the said Commissioners may, with the assent of the Treasury, relax in the case of any goods any requirements of Sections one hundred and four and one hundred and six of the Customs Consolidation Act, 1876, as to the giving of security and the examination of goods.—[Mr. John Murray.]

Brought up, and read the First time.

Mr. JOHN MURRAY: I beg to move, "That the Clause be read a Second time."
I hope that this Clause will commend itself to the House as a whole, and to the Financial Secretary. It is intended to assist a small but promising industry which, at present, is unable to export its goods—namely, the manufacture of coffee extract which is put up in dried and powdered form in tins. This young industry has every chance of making good in certain foreign markets, if it has the same advantage which is given to certain other similar industries, of receiving, on export, a rebate of the duty paid on the material when it came in. If the coffee extract referred to is obliged to pay a duty on entering this country, and the manufactured essence is required to pay a duty on entering some foreign country, the two duties make it impossible to trade abroad. If this proposed new Clause be accepted, it is clear that this small but promising industry will be able to forge ahead in certain foreign markets, bring money into this country, and provide employment for quite a number of people.

11.0 P.M.

Mr. HARRIS: I beg to second the Motion. The Clause will give a stimulus to a small industry that promises to be of importance, especially to the Colonies. It is not intended by the Government to handicap an industry by the peculiarities of our Excise. If the right hon. Gentleman can see his way to accept the Amendment, it will help to bring into existence what, I hope, will some day be an important industry.

Sir W. JOYNSON-HICKS: I am sure I am not so hard-hearted as some hon. Members suggest. I should like to be able to find an Amendment I can accept. I gather this coffee extract has already paid duty on coming into the country, and there should, of course, be a rebate when it goes out of the country. I shall be glad to accept.

Mr. A. V. ALEXANDER: One is really surprised at the gymnastics of hon. Members below the Gangway on the Liberal benches. Here is a principle involved in an Amendment regarding coffee which many of them went into the Division Lobby last week to oppose in regard to the preference on sugar. The right hon. Gentleman the Member for Paisley (Mr. Asquith) supported the remarks I made in moving the repeal, and here you have
Liberals now adopting a purely Protectionist attitude in regard to coffee. The Financial Secretary obviously is quite delighted. I hope those who pose as champions of Free Trade will see fit not to let the Financial Secretary give them this concession, but will vote against it.

Clause read a Second time, and added to the Bill.

NEW CLAUSE.—(Amendment to Schedule 2 of Finance Act, 1920.)

The Finance Act, 1920, Second Schedule, paragraph (5), shall be amended by the addition of the following words:—
Vehicles exceeding two tons and over, but fitted wholly with pneumatic tyres, shall be liable to only fifty per cent. of the above-mentioned duties.—[Lieut. Colonel Moore-Brabazon.]

Brought up, and read the First time.

Lieut.-Colone MOORE-BRABAZON: I beg to move, "That the Clause be read a Second time."
This is such a good Clause that I very much doubt whether it will be accepted. The taxes derived from motor vehicles do not go to the Exchequer, but to the Road Fund. The object of the Clause is to diminish the damage done to roads by heavy vehicles. It is undoubtedly the fact that the chief damage done to roads is through heavy vehicles with solid tyres pounding away at high speed over foundations which are very inadequate to carry such vehicles. If you give encouragement to motor vehicles to fit pneumatic tyres the damage to the roads will be considerably less. That is the point of the Clause I am moving. The giant pneumatic tyre in this country is very little known, not because it is not good, but because no encouragement is given for any motor vehicle to use it at all. It has enormous advantages, first, from the point of view of comfort to the passengers, and from the point of view of the lessening of the damage to goods carried. The Government will lose very little revenue in the diminution of the tax, and they would save by that more than 10 per cent. with regard to the damage at present done to the roads by vehicles of this type. I know very well that if I had moved this Amendment about a year ago I should have had the very cordial support of the present
Financial Secretary to the Treasury. Not only should I have had his support, but I could have induced him to also speak on behalf of this particular Clause. I hope the right hon. Gentleman will not shift the burden of replying to this Clause on to some other Minister, but will reply himself. I hope, also, that he will not adopt a negative position and become the stony-hearted individual which he has so often been accused of being.

Viscount CURZON: I beg to second the Motion.
There is very little for me to add in support of what my hon. and gallant Friend has said, other than to point out that the problem of the roads is one of the most serious we have to face to-day. Road expenditure is going up, and it is doubtful whether the sources of revenue designed to meet the expenditure will be sufficient in years to come if the cost goes on increasing as it is doing now. I therefore trust that the right hon. Gentleman will be able to give this Clause his favourable and sympathetic consideration, and that we may hope that real encouragement will be given to manufacturers to fix these giant, pneumatic tyres on their vehicles.

The PARLIAMENTARY SECRETARY to the MINISTRY of TRANSPORT (Colonel Ashley): I am sorry to have to disappoint my hon. and gallant Friend the Member for Rochester (Lieut.-Colonel Moore-Brabazon), and also myself, as I have to be sacrificed on the altar of his wrath, by speaking instead of the Financial Secretary. I have very considerable sympathy with the new Clause of my hon. and gallant Friend. We all want to encourage the use of these pneumatic tyres, as distinct from the heavy tyres, because the latter do contribute to the wear and tear of the roads, which is a very severe burden on the finance of the rural authorities and of the Road Fund. I would point out, however, that the Departmental Committee of the Ministry of Transport is still sitting. They have not yet reported on the fuel tax, or whether we shall be compelled to continue the present basis of taxation. If they report that the present basis of taxation is to be continued, undoubtedly they would then proceed to give quite a considerable number of recommendations and references on the present cases, and this particular point will be very seriously
considered by them. It is not quite certain that what the hon. and gallant Member desires would be better arrived at by a lowering of the taxation; it might very well be achieved by giving an increased speed to those heavy vehicles which have pneumatic tyres. We have at the present moment very little experience as to what would be the effect on the giant pneumatic tyres if they were used, as they would be, on six-ton lorries, or even more. They might easily burst, and the lorry driver might be killed.

Sir WILFRID SUGDEN: No, no.

Colonel ASHLEY: There is also the danger, if once you have given a licence to a man having a pneumatic tyre, that he would go back to a solid tyre. Finally, there is the difficulty of defining what a pneumatic tyre is. I have every sympathy with the Clause, and in due time I will consider it.

Question, "That the Clause be read a Second time," put, and negatived.

NEW CLAUSE.—(Amendment of s. 12 of Finance Act, 1922.)

Section twelve of the Finance Act, 1922, which reduces the duties to be charged on certain negative cinematograph films, shall have effect as though for the condition requiring all the principal actors and artists employed for the production of a film to be British subjects and domiciled in Great. Britain or Northern Ireland there were substituted a condition requiring all such principal actors and artists, except five, or if the total number of the principal actors and artists is less than twenty not less than three-quarters of the principal actors and artists to be British subjects and domiciled as aforesaid, and for the purposes of the said Section twelve, as amended by this Section, the expression "artists" shall include the person working the photographic camera by means of which the pictures composing the film are taken.—[Mr. Gates.]

Brought up, and read the First time.

Mr. GATES: I beg to move, "That the Clause be read a Second time."
I put down this Clause at the instance of the British National Film League, the Chairman of which is an influential constituent of mine. The House may remember that by the Finance Act, 1919, a duty of 5d. a foot was placed on imported negative cinematograph films and one-third of a penny on blank films. The duty of 5d. a foot was found to be an oppressive tax, and Section 12 of the Finance Act, 1922, pro-
vided that imported negative cinematograph films were to be admitted for the purpose of import duty as blank films at one-third of a penny a foot instead of 5d. a foot, provided that the producers and actors employed in the production were British subjects domiciled in the United Kingdom. This Amendment was intended to be of benefit to the British film industry, and they were informed that the construction of the Statute would be a beneficial one to them. Unfortunately, that has not proved to be the case, and the construction passed upon the Statute by the Customs and Excise has been somewhat of a restrictive nature.
I will give the House a case which happened the other day. A British film company, with British directors and shareholders, sent out a company of 12 persons to Venice in order to produce the exterior scenes of a film there. Every member of the company, from the producers downwards, was British After a week in Venice, one of the company, owing to circumstances beyond the control of the company, returned to England, and it became necessary to employ an Italian to complete the caste. On the arrival of the film in England, objection was taken at once by the Customs and Excise because one of the characters had been played by a foreigner, and the company were asked to pay duty at the rate of 5d. a foot, amounting to about £600. Objection was at once taken by the company, and the matter was referred to the Board of Customs and Excise. Sir Horace Hamilton wrote that it was clear that the employment of any foreigner as a principal actor to assist in the production of a film must debar any claim for relief under Section 12 of the Act of 1922. It was felt that that interpretation was very bad upon the British film companies, and that they were placed under a serious handicap, for, as the House knows, there is immense competition with the American film industry. In America only one per cent. of British films are released, a very different state of things from that obtaining in this country, where the percentage of American films released is very considerable. The object of a British film company in sending a company abroad is to get local colour and scenery and some local inhabitants.

Sir W. JOYNSON-HICKS: I am quite sure the hon. Member does not wish to
take up the time of the House, and I shall be prepared to accept the Amendment if he will unreel himself now.

Mr. GATES: I am very much obliged to my right hon. Friend, and I would like to extend to him the thanks of the British National Film League and of myself for his courtesy.

Major M. WOOD: I beg to second the Motion.

Clause read a Second time, and added to the Bill.

NEW CLAUSE.—(Relief in respect of Super-tax in the case of income earned during the War in a country controlled by the enemy and distributed after the termination of the War.)

For the purpose of computing Super-tax in the case of any person who has received in any year income from a source that, during the late European War, was under the occupation or control of the enemy, the Special Commissioners, if they are satisfied that such income was earned in years other than the year of assessment, shall average such income over the various years during which they shall decide such income was actually earned.—[Mr. Samuel Roberts.]

Brought up, and read the First time.

Mr. SAMUEL ROBERTS: I beg to move, "That the Clause be read a Second time."
I have put this new Clause down to meet a very serious case of hardship under the Super-tax Act. I can best explain the matter by giving the actual facts put to me by a taxpayer. This taxpayer has an income of about £1,000 a year, which is £1,000 below the Super-tax level. He held as an investment shares in the Malay Estates Rubber Company, which was a Belgian company, situated in Antwerp. Because it was situated at Antwerp during the War, and Antwerp was in German occupation, the company could not distribute the dividend for five years to its shareholders, otherwise they would have been confiscated by the Germans. The consequence was that after the Armistice the whole of the profits earned for a period of five years were distributed in March or April, 1919–20, and this man, who always before was £1,000 below the Super-tax level, and since has been below the Super-tax level, suddenly found himself, because of
the German occupation, having to pay Super-tax. [HON. MEMBERS: "Oh!"] Hon. Members opposite seem to think that is an amusing circumstance. They consider that anybody earning any profits is a sinner If people do earn profits, they should be treated equally, one with another. I put this case forward simply on the ground that this man has suffered because of an act of war, through an act of the King's enemies, and, that being so, I ask the right hon. Gentleman to see if he cannot remedy this grievance. Possibly the answer may be that if he opened the door in this way he would be opening the door for many other instances. To that I would reply that if the other cases are as hard as this, it is time the door was opened and the other cases dealt with. This case does not mean opening the door for the future. This is a case due to an act of war, and it is not just that the man should be mulcted in this way.

Mr. DENNIS HERBERT: I beg to second the Motion.
This is a case of correcting what is an unintentional error of legislation. In the ordinary way it is not intended that, if a man is debarred in one year from receiving his income and receives the arrears in subsequent years, that he should be taxed more heavily than if he had received it from year to year. Hon. Members opposite will sympathise with the principle if I say this—supposing, owing to some dispute or some alteration, Members of this House did not get their £400 one year, and the following year they received not only the £400 for that year, but the £400 for the previous year. It would be a little hard if Income Tax was taken as though the income was £800.

Sir W. JOYNSON-HICKS: I almost accepted this Amendment, becouse the hon. Member for Hereford (Mr. S. Roberts) put a case of great hardship; but the hon. Member for Watford (Mr. W Herbert) enlarged the position so much, and showed the difficulties that would arise if I were to give any encouragement. The case quoted by the hon. Member for Hereford is a case of very great hardship and I wish it were possible to give the relief that he wants in regard to it. The moment I do that I let loose the whole difficulty as to Super-tax law. It has been decided recently in
a Scottish case that Super-tax is chargeable for the year in which dividends are paid. If this Clause were accepted we should have the Super-tax payer coming to the Commissioners and saying, "This dividend was earned the year before last, only the company did not pay me, and I want to spread that over last year so that I shall not have to pay Super-tax upon it," and it would open up to the Commissioners a vista of all kinds of new calculations as to the incidence of Super-tax. The only way we can estimate the Super-tax is to take the dividend from the date on which it is paid and include it in the Super-tax for that year.

Mr. D. HERBERT: I am afraid that it is almost too much to expect to be able to shove my right hon. Friend over the edge, though he has gone so far, but what we ask is to be taxed according to the year in which the dividend is due to be paid. It has nothing to do with the time when it was earned. This is a payment which was due to be paid in previous years.

Question, "That the Clause be read a Second time," put, and negatived.

NEW CLAUSE.—(Allowance for spirit used for the manufacture of perfumery.)

If any person proves to the satisfaction of the Commissioners of Customs and Excise that any spirits in respect of which the duties imposed by this Act have been paid have been delivered to him and used solely in the manufacture or preparation of perfumery, he shall, subject to such regulations as the Commissioners of Customs and Excise may prescribe, be entitled to obtain from the Commissioners repayment of the sum of thirty-seven shillings in respect of every gallon computed at proof of spirit so used.—[Mr. Lorimer.]

Brought up, and read the First time.

Mr. LORIMER: I beg to move, "That the Clause be read a Second time."
The perfumery trade is one of those which do no harm and do a considerable amount of good. It is a trade which is essential to the manufacture of tooth pastes. It is by keeping the teeth clean that this country rears healthy children. I appeal with confidence to the Minister of Health on this point. If the Chancellor of the Exchequer grants this concession he will lose no revenue, but he will gain. The Minister of Labour will also benefit because of the increase in the number of men employed in the per-
fumery trade which will reduce the number of doles. It is impossible at this late hour to go into this technical subject, but I am sure that the Financial Secretary knows all these points. Therefore, I content myself by moving the Amendment.

Mr. GRATTON DOYLE: I beg to second the Motion.
In doing so, I wish to make a very earnest plea for one of the young industries started during the War. This is an industry which certain manufacturers undertook as a new branch of their business. Before the War it was practically non-existent in this country and very few people were employed in it. In view of the fact that nearly all these products, before the War, were imported from Germany and France, some enterprising manufacturers took up the business in this country, and up to 1918 the industry had increased by no less than seven times. On the application of this excessive duty it fell to one and a half times its original volume. The number of people engaged in the industry was increased by over six times, and now, owing to the duty, that has been reduced to only one and a half times. The amount of duty charged just before the War was 14s. 9d., which has been increased to 74s., and no other trade or industry has been penalised to such an extent. If this rate of duty is maintained, this struggling industry will be strangled and unemployment will be created. I hope my right hon. Friend after hearing this plea will soften his heart—that stony heart which has resisted so many appeals. I observe a smile flitting over his genial countenance, and possibility it is not too much to hope that he will say the simple word which will save this industry, preserve the employment which it affords, and give satisfaction to those engaged in it.

Sir W. JOYNSON-HICKS: I should like to do so, on the ground suggested by the hon. Member for North Kensington (Mr. Gates) in regard to a previous Amendment. A great deal of this material is made in my own constituency, but a Financial Secretary of the Treasury must not think of his constituency. He must think of the Treasury. In this case the reduction of the duty by one-half would mean a loss to the revenue of about £1,000,000 per year.

Mr. DOYLE: We would be satisfied with less.

Sir W. JOYNSON-HICKS: My hon. Friend has asked for the half, and I cannot give it.

Mr. DOYLE: Or a quarter.

Sir W. JOYNSON-HICKS: If my hon. Friend wants to make a deal in that way, he will have to wait until the Finance Bill is introduced next year, when, perhaps, he may find a less hard-hearted Financial Secretary.

Mr. PRINGLE: The right hon. Gentleman will be Chancellor of the Exchequer then.

Captain BERKELEY: I hope it is not too late to ask on what ground is the distinction made between spirit used for the manufacture of perfume and spirit used for other manufactures? Surely that is the basis upon which a decision must be reached. This perfumery trade is a very extensive trade in the country, and it is a perfectly reasonable thing for the perfumers and the large chemists to appeal to this House to lessen the burden of taxation upon their industry in the same manner as it is lessened in the case of other industries employing commercial alcohol. I beg the Government to reconsider the matter, and to meet the demand of the industry for relief.

Question, "That the Clause be read a Second time," put, and negatived.

NEW CLAUSE.—(Six-wheeled vehicles.)

A vehicle used in combination with a trailer which has not more than two wheels in contact with the ground and is so constructed and by partial super-imposition so attached to the vehicle that at all times the weight on the rear axle of the vehicle exceed the weight on the axle of the trailer the vehicle and trailer shall for the purpose of determining the rate of duty chargeable under the Second Schedule to The Finance Act, 1920, but not for any other purpose, be treated as if it were a single vehicle used for drawing a trailer.—[Viscount Curzon.]

Brought up, and read the First time.

Viscount CURZON: I beg to move, "That the Clause be read a Second time."
This Clause is designed to meet a new case that has arisen since the passing of the Finance Act, 1920. That Act laid it down specifically that motor vehicles with
trailers should be charged at a specific rate.

Lieut.-Colonel MOORE-BRABAZON: I beg to second the Motion.

Colonel ASHLEY: I am prepared to accept this new Clause, with two small Amendments.

Question put, and agreed to. Clause read a Second time.

Amendments made:

Leave out the words "A vehicle," and insert instead thereof the words "Where a vehicle is."

At the end of the Clause insert the words
This Section shall come into operation on the first day of January, nineteen hundred and twenty-four." — [Colonel Ashley.]

Clause, as amended, added to the Bill.

NEW CLAUSE.—(Estate duty.)

For determining the rate of estate duty to be paid on property passing on the death of the deceased, any property so passing which, under a disposition not made by the deceased, passes immediately on the death of the deceased to some person other than the wife or husband or a lineal ancestor or lineal descendant of the deceased, shall not be aggregated with any other property but shall be an estate by itself and the estate duty shall be levied at the proper graduated rate on the principal value thereof.—[Mr. Entwistle.]

Brought up, and read the First time.

Mr. ENTWISTLE: I beg to move, "That the Clause be read a Second time."
The object which I seek to obtain by this new Clause is to prevent the aggregation of property which goes to a person under a disposition made other than by the deceased. The Clause will not bring about any great revolution, nor, I think, can the draftsmanship of it be attacked. because it merely seeks to restore the proviso in Section 4 of the Finance Act, 1894, which was repealed, except as regards property in which the deceased had no interest at all, by Section 12 of the Finance Act, 1900. The point which I seek to obtain can, perhaps, be more readily explained by an illustration. Suppose A bequeaths a legacy of £500 to B for life, and after B's death the remainder to C, and suppose that C is no relative whatsoever of B, because this Clause does not apply where he
is a relative in the way of a lineal descendant. C has no interest at all in B, and the legacy is merely £500. The Estate Duty on that legacy is not payable out of B's estate, through whose death the Estate Duty is payable, because the executors of B are liable to pay duty only in respect of property of which the deceased is competent to dispose, whereas in this case he is not competent to dispose of this property at all. He has merely a life interest under a disposition made by some other person. We will suppose that B dies a very wealthy person, and leaves as much as £1,000,000, liable to Estate Duty at the rate of 25 per cent. As the executors only have to pay that duty in respect of the property of which he has obtained disposition as regards the legacy of £500—or £100 if you like—C, who has to pay this duty has got to pay it at the rate of duty which applies to the whole of the properties of B, who may be a millionaire. I think the proposition has only to be stated to show hon. Members what an unreasonable position it is. Why should C, who is no relation at all of deceased, and who only gets this one small legacy, be penalised to the extent of having to pay estate duty at the rate of a millionaire? When the point was first brought to my notice I could scarcely credit it. But when I found out that this was the abrogated provision—as it was incorporated in the Section 4 of the Finance Act, 1894—it was obviously an injustice putting this tremendous burden on the remainder when they had no interest in the deceased, but was simply a tenant for life. I wondered how on earth it could be, and I took the trouble to go through the Parliamentary Debates of 1900 when Section 12 was passed which repealed Section 4 except in one small particular. I found out there that the one argument used by the then Solicitor-General was that in Section 4 the one provision that prevents this aggregation does not apply to lineal descendants; therefore the relief was granted purely to collaterals in the Act, passed, I think, in 1900. It was far easier to arouse sympathy on behalf of lineal descendants than on behalf of collaterals. But they missed the whole point that if the proviso as it stood in Section 4, and as it would be restored by my Amendment, was to help lineal descendants just as much as collaterals.
It is quite clear, too, from these Debates that the matter was not then very thoroughly considered, and that the House, when it passed that particular Clause, did not appreciate everything that would result.
Let me give an instance that came to my knowledge the other day showing how reasonable is this new Clause. It was a case where, under the disposition of A, the latter bequeathed his property for life to B, after whose death a legacy of £500 went to C and D. B died, and B's executors returned the estate at a certain value; then B's executors discovered, three years after, that they had made a mistake of £100,000. It had to be aggregated with the £500 legacy. That meant that it had to be aggregated with this small £500 legacy, which was the only thing in which C and D had an interest, and the further Estate Duty that had to be paid was at the rate attributable to that £100,000, and it had to be paid on the miserable sum of £500. I am putting this case forward in the interest of those who were concerned only in the £500. Further, it was found that A's executors having distributed the estate had no money out of which they could pay the extra Estate Duty, and so they had to come on to C and D to pay it. When a person had no interest except in the legacy of £500 surely the Estate Duty payable by them should be at the rate appropriate to that sum and not to the whole estate. That was the provision made in Section 4 of the Finance Act of 1894, but under a misapprehension it was repealed by Section 12 of the Finance Act of 1900. I suggest it is only reasonable that that provision should be restored. I do not know what the concession would cost, but I do not think it would be very much. It is a just proposal, and I hope the Financial Secretary will be able to accept it.

Mr. COLLINS: I have much pleasure in seconding the Motion.

The SOLICITOR-GENERAL: The hon. and learned Member for South West Hull (Mr. Entwistle) has explained very fairly to the House the object of this Amendment, and at first sight some hon. Members, unacquainted with the history of the provision, may be led to think it is reasonable. But there is one fact which possibly the hon. and learned Gentleman is not aware of in connection with this
matter which throws a very different light upon it. The provision he proposes to re-enact was originally embodied in the Act of 1894. The exemption of these collaterals or strangers was much criticised year after year, and finally the Chancellor of the Exchequer, in the year 1899, set up a very strong Committee to consider it. The Committee was composed of Lord Finlay, Lord Loreburn (Sir R. Reid as he then was), Lord Haldane, the right hon. Gentleman the Member for Chelmsford (Mr. Pretyman), and Sir Henry Primrose. That Committee, on a review of the circumstances connected with the Clause and its inception in the Finance Act of 1894, reported unanimously that the Clause operated for the benefit of collaterals and strangers who really had no right to expect a transfer of the property, and although it was really intended to affect the immediate family of the deceased person, it did not operate to protect them. It benefitted strangers and collaterals at the expense of the public revenue. Therefore this strong, impartial, non-party Committee reported against the Clause, and it was accordingly got rid of in the Act of 1900.

Mr. ENTWISTLE: Is it not the fact that at the time the Committee reported, settled estate duty was payable, but not on the death of the tenant for life? That has been abolished by the Act of 1916, and it makes a tremendous difference. Settled Estate Duty was not then paid in these cases.

The SOLICITOR-GENERAL: I do not think it really touches the point. The feature of the Committee's Report was that the exemption in the Act of 1894 was intended to protect the immediate family and the lineal descendants of the deceased, whereas it was found in operation to relieve collaterals and strangers of a burden which they should bear. There might be no immediate family and the rest of the estate might go away entirely from the family. The Committee reported in favour of repealing the Section, and it would be a distinctly retrograde step on the part of this House to re-enact a Clause which Parliament deliberately deleted. Although there may be hard cases, as there are in connection with all these duties, I suggest to the House that it should not retrace the step deliberately taken in 1900.

Mr. D. HERBERT: I should like to express my hope that the Financial Secretary will go into this question somewhat more carefully before next year. I think it is perfectly certain that the Committee's Report was arrived at under conditions entirely different from those which now obtain. I want to reinforce what was said by the Mover of

the Amendment by saying that I know, from personal experience, cases of hardship which, on the face of them, are so ridiculous that they might well be embodied in comic opera.

Question put, "That the Clause be read a Second time."

The House divided: Ayes, 120; Noes, 215.

Division No. 264.]
AYES.
[11.47 p.m.


Alexander, A. V. (Sheffield, Hillsbro')
Harris, Percy A.
Parry, Lieut.-Colonel Thomas Henry


Ammon, Charles George
Hayday, Arthur
Pattinson, S. (Horncastle)


Attlee, C. R.
Hayes, John Henry (Edge Hill)
Phillipps, Vivian


Barrie, Sir Charles Coupar (Banff)
Henderson, Rt. Hon. A. (N'castle, E.)
Potts, John S.


Batey, Joseph
Herriotts, J.
Pringle, W. M. R.


Benn, Captain Wedgwood (Leith)
Hill, A.
Riley, Ben


Bennett, A. J. (Mansfield)
Hinds, John
Ritson, J.


Bonwick, A.
Hirst, G. H.
Robertson, J. (Lanark, Bothwell)


Bowdler, W. A.
Jenkins, W. (Glamorgan, Neath)
Royce, William Stapleton


Bowerman, Rt. Hon. Charles W.
John, William (Rhondda, West)
Saklatvala, S.


Broad, F. A.
Johnston, Thomas (Stirling)
Salter, Dr. A.


Brown, James (Ayr and Bute)
Jones, J. J. (West Ham, Silvertown)
Sexton, James


Buckie, J.
Jones, Morgan (Caerphilly)
Shaw, Hon. Alex. (Kilmarnock)


Burgess, S.
Jones, R. T. (Carnarvon)
Shaw, Thomas (Preston)


Buxton, Charles (Accrington)
Jones, T. I. Mardy (Pontypridd)
Short, Alfred (Wednesbury)


Chapple, W. A.
Jowett, F. W. (Bradford, East)
Sitch, Charles H.


Charleton, H. C.
Lansbury, George
Snell, Harry


Collins, Pat (Walsall)
Lawson, John James
Spencer, George A. (Broxtowe)


Cotts, Sir William Dingwall Mitchell
Leach, W.
Stephenson, Lieut.-Colonel H. K.


Darbishire, C. W.
Lee, F.
Strauss, Edward Anthony


Davies, Evan (Ebbw Vale)
Lees-Smith, H. B. (Keighley)
Sullivan, J.


Davies, Rhys John (Westhoughton)
Linfield, F. C.
Thomson, T. (Middlesbrough, West)


Dudgeon, Major C. R.
Lunn, William
Thornton, M.


Duffy, T. Gavan
M'Curdy, Rt. Hon. Charles A.
Turner, Ben


Dunnico, H.
MacDonald, J. R. (Aberavon)
Waring, Major Walter


Ede, James Chuter
Macdonald, Sir Murdoch (Inverness)
Watson, W. M. (Dunfermline)


Edge, Captain Sir William
M'Entee, V. L.
Watts-Morgan, Lt.-Col. D. (Rhondda)


Edwards, C. (Monmouth, Bedwellty)
McLaren, Andrew
Webb, Sidney


Evans, Ernest (Cardigan)
March, S.
Westwood J.


Foot, Isaac
Marshall, Sir Arthur H.
Whiteley, W.


George, Major G. L. (Pembroke)
Martin F. (Aberd'n & Kinc'dine, E.)
Williams, David (Swansea, E.)


Gosling, Harry
Moreing, Captain Algernon H.
Williams, Dr. J. H. (Llanelly)


Graham, D. M. (Lanark, Hamilton)
Morel, E. D.
Williams, T. (York, Don Valley)


Greenall, T.
Morrison, R. C. (Tottenham, N.)
Wilson, C. H. (Sheffield, Attercliffe)


Grenfell, D. R. (Glamorgan)
Mosley, Oswald
Wood, Major M. M. (Aberdeen, C.)


Griffiths, T. (Monmouth, Pontypool)
Murnin, H.
Young, Rt. Hon. E. H. (Norwich)


Groves, T.
Murray, John (Leeds, West)
Young, Robert (Lancaster, Newton)


Grundy, T. W.
O'Grady, Captain James



Hall, F. (York, W. R. Normanton)
Oliver, George Harold
TELLERS FOR THE AYES.—


Hall, G. H. (Merthyr Tydvil)
Paling, W.
Mr. Entwistle and Captain


Hamilton, Sir R. (Orkney & Shetland)
Parkinson, John Allen (Wigan)
Berkeley.


Hardie, George D.




NOES.


Agg-Gardner, Sir James Tynte
Boyd-Carpenter, Major A.
Cockerill, Brigadier-General G. K.


Alexander, Col. M. (Southwark)
Brass, Captain W.
Colfox, Major Wm. Phillips


Amery, Rt. Hon. Leopold C. M. S.
Bridgeman, Rt. Hon. William Clive
Colvin, Brig.-General Richard Beale


Archer-Shee, Lieut.-Col. Sir Martin
Brittain, Sir Harry
Conway, Sir W. Martin


Ashley, Lt.-Col. Wilfrid W.
Brown, Brig.-Gen. Clifton (Newbury)
Cope, Major William


Baird, Rt. Hon. Sir John Lawrence
Brown, Major D. C. (Hexham)
Craig, Captain C. C. (Antrim, South)


Baldwin, Rt. Hon. Stanley
Bruton, Sir James
Croft, Lieut.-Colonel Henry Page


Balfour, George (Hampstead)
Buckingham, Sir H.
Crook, C. W. (East Ham, North)


Banbury, Rt. Hon. Sir Frederick G.
Butcher, Sir John George
Curzon, Captain Viscount


Banks, Mitchell
Butler, H. M. (Leeds, North)
Davidson, J. C. C. (Hemel Hempstead)


Barlow, Rt. Hon. Sir Montague
Butt, Sir Alfred
Davies, Alfred Thomas (Lincoln)


Barnett, Major Richard W.
Button, H. S.
Davison, Sir W. H. (Kensington, S.)


Barnston, Major Harry
Cadogan, Major Edward
Dawson, Sir Philip


Becker, Harry
Campion, Lieut.-Colonel W. R.
Dixon, C. H. (Rutland)


Bell, Lieut.-Col. W. C. H. (Devizes)
Cayzer, Sir C. (Chester, City)
Doyle, N. Grattan


Bellairs, Commander Carlyon W.
Cecil, Rt. Hon. Sir Evelyn (Aston)
Du Pre, Colonel William Baring


Benn, Sir A. S. (Plymouth, Drake)
Cecil, Rt. Hon. Lord H. (Ox. Univ.)
Edmondson, Major A. J.


Bennett, Sir T. J. (Sevenoaks)
Chadwick, Sir Robert Burton
Ednam, Viscount


Betterton, Henry B.
Chamberlain, Rt. Hon. N. (Ladywood)
Elliot, Capt. Walter E. (Lanark)


Birchall, Major J. Dearman
Churchman, Sir Arthur
Ellis, R. G.


Bird, Sir William B. M. (Chichester)
Clarry, Reginald George
Erskine, Lord (Weston-Super-Mare)


Blades, Sir George Rowland
Clayton, G. C.
Evans, Capt. H. Arthur (Leicester, E.)


Bowyer, Capt. G. E. W.
Cobb, Sir Cyril
Eyres-Monsell, Com. Bolton M.


Falle, Major Sir Bertram Godfray
King, Captain Henry Douglas
Robertson-Despencer, Major (Islgtn, W.)


Fawkes, Major F. H.
Kinloch-Cooke, Sir Clement
Roundell, Colonel R. F.


Fermor-Hesketh, Major T.
Lamb, J. Q.
Ruggles-Brise, Major E.


Flanagan, W. H.
Lane-Fox, Lieut.-Colonel G. R.
Russell, William (Bolton)


Ford, Patrick Johnston
Lloyd, Cyril E. (Dudley)
Russell-Wells, Sir Sydney


Foxcroft, Captain Charles Talbot
Lloyd-Greame, Rt. Hon. Sir P.
Samuel, A. M. (Surrey, Farnham)


Fremantle, Lieut.-Colonel Francis E.
Locker-Lampson, Com. O. (Handsw'th)
Samuel, Samuel (W'dsworth, Putney)


Furness, G. J.
Lorimer, H. D.
Sanderson, Sir Frank B.


Galbraith, J. F. W.
Lort-Williams, J.
Sandon, Lord


Ganzoni, Sir John
Loyd, Arthur Thomas (Abingdon)
Sassoon, Sir Philip Albert Gustave D.


Garland, C. S.
Lumley, L. R.
Scott, Sir Leslie (Liverp'l, Exchange)


Gates, Percy
McNeill, Ronald (Kent, Canterbury)
Shepperson, E. W.


Gaunt, Rear-Admiral Sir Guy R.
Margesson, H. D. R.
Shipwright, Captain D.


Gilmour, Lt.-Col. Rt. Hon. Sir John
Mason, Lieut.-Col. C. K.
Simpson-Hinchliffe, W. A.


Goff, Sir R. Park
Mercer, Colonel H.
Skelton, A. N.


Gould, James C.
Milne, J. S. Wardlaw
Smith, Sir Allan M. (Croydon, South)


Greaves-Lord. Walter
Mitchell, W. F. (Saffron Walden)
Smith, Sir Harold (Wavertree)


Gretton, Colonel John
Mitchell, Sir W. Lane (Streatham)
Somerville, A. A. (Windsor)


Guinness, Lieut.-Col. Hon. W. E.
Moore-Brabazon, Lieut.-Col. J. T. C.
Somerville Daniel (Barrow-in-Furness)


Hacking, Captain Douglas H.
Murchison, C. K.
Stanley, Lord


Hall, Lieut.-Col. Sir F. (Dulwich)
Nall, Major Joseph
Stott, Lt.-Col. W. H.


Hall, Rr-Adml Sir W. (Liv'p'l, W. D'by)
Nesbitt, Robert C.
Sueter, Rear-Admiral Murray Fraser


Halstead, Major D.
Newman, Colonel J. R. P. (Finchley)
Sugden, Sir Wilfrid H.


Hamilton, Sir George C. (Altrincham)
Newman, Sir R. H. S. D. L. (Exeter)
Sutherland, Rt. Hon. Sir William


Hannon, Patrick Joseph Henry
Newson, Sir Percy Wilson
Sykes, Major-Gen. Sir Frederick H.


Harmsworth, Hon. E. C. (Kent)
Newton, Sir D. G. C. (Cambridge)
Thompson, Luke (Sunderland)


Harrison, F. C.
Nicholson, Brig.-Gen. J. (Westminster)
Thomson, F. C. (Aberdeen, South)


Harvey, Major S. E.
Nicholson, William G. (Petersfield)
Tillett, Benjamin


Hawke, John Anthony
O'Neill, Rt. Hon. Hugh
Tryon, Rt. Hon. George Clement


Henn, Sir Sydney H.
Ormsby-Gore, Hon. William
Tubbs, S. W.


Hennessy, Major J. R. G.
Paget, T. G.
Turton, Edmund Russborough


Herbert, Dennis (Hertford, Watford)
Parker, Owen (Kettering)
Wallace, Captain E.


Hilder, Lieut.-Colonel Frank
Pease, William Edwin
Ward, Col. L. (Kingston-upon-Hull)


Hiley, Sir Ernest
Pennefather, De Fonblanque
Watts, Dr. T. (Man., Withington)


Hogg, Rt. Hon. Sir D. (St. Marylebone)
Penny, Frederick George
Weston, Colonel John Wakefield


Hohler, Gerald Fitzroy
Percy, Lord Eustace (Hastings)
Wheler, Col. Granville C. H.


Holbrook, Sir Arthur Richard
Perkins, Colonel E. K.
White, Lt.-Col. G. D. (Southport)


Hood, Sir Joseph
Perring, William George
Whitla, Sir William


Hopkins, John W. W.
Philipson, Mabel
Windsor-Clive, Lieut.-Colonel George


Hopkinson, A. (Lancaster, Mossley)
Pownall, Lieut.-Colonel Assheton
Winterton, Earl


Houfton, John Plowright
Pretyman, Rt. Hon. Ernest G.
Wise, Frederick


Hudson, Capt. A.
Privett, F. J.
Wolmer, Viscount


Hume, G. H.
Raine, W.
Wood, Major Sir S. Hill- (High Peak)


Hurd, Percy A.
Rees, Sir Beddoe
Woodcock, Colonel H. C.


Inskip, Sir Thomas Walker H.
Remer, J. R.
Worthington-Evans, Rt. Hon. Sir L.


Jenkins, W. A. (Brecon and Radnor)
Remnant, Sir James
Yerburgh, R. D. T.


Jephcott, A. R.
Rhodes, Lieut.-Col. J. P.



Jodrell, Sir Neville Paul
Richardson, Sir Alex. (Gravesend)
TELLERS FOR THE NOES.—


Joynson-Hicks, Sir William
Richardson, Lt.-Col. Sir P. (Chertsey)
Colonel Leslie Wilson and Colonel


Kelley, Major Fred (Rotherham)
Roberts, Samuel (Hereford, Hereford)
Gibbs.


Question, "That the Clause be read a Second time," put, and agreed to.

NEW CLAUSE.—(Amendment of s. 32 of the Finance Act, 1921.)

Section thirty-two of The Finance Act, 1921 (which relates to exemption of superannuation funds from Income Tax), shall be amended as follows:
At the end of paragraph (b), of Subsection (3), there shall be inserted the words "or for widows and/or orphans of persons employed in the trade or undertaking."—[Sir Leslie Scott.]

Brought up, and read the First time.

Sir LESLIE SCOTT: I beg to move, "That the Clause be read a Second time."
This proposes an extension of the exemption granted in respect of superannuation funds from Income Tax. The main Clause was passed in 1921 and exempted the investments of superannuation funds from taxation and also the contributions by the employers and by the employés. The object of the Clause was clearly to encourage thrift by
encouraging superannuation funds at a cost to the revenue which it was recognised would be very small. The extension which is involved in this Clause is to give the benefit of that exemption, which is at present limited to funds for the actual employés, to the case of their widows and orphans. It has been found in experience under the original Clause that it is very inconvenient to keep the widows' and orphans' fund out of the men's fund for all purposes and to have entirely distinct funds. In addition, it is felt that every reason which led the House to adopt the provision in 1921 is really equally applicable, and in certain respects even more so, in respect of the widows and orphans. In the case of widows and orphans the extreme limit of the exemption is from tax upon investments. As the widows and orphans will not themselves be making contributions and the contributions of the employers and of the
husbands or fathers, as the case may be, would have been the source of their contributions to the fund, this exemption is only for one-third, so to speak, of the benefits given by the Clause of 1921.
12 M.
The truth of the matter is that in this country, with the British character as we know it, thrift, which necessitates putting by every week the same small sum of money in order to provide a fund out of which an annuity will be available in later life, or for orphans and widows, is an exceedingly difficult thing, and, in addition, if you assume that weekly habit of thrift, the knowledge of how wisely to invest the fund so accumulated is very rare, and those are the two real reasons in favour of superannuation funds, and why it is worth while to encourage them to the maximum. I understand the total cost to the revenue of this Clause will be very small. In addition, from the information available, these funds have a very decided effect in saving the revenue from the necessity of paying Old Age Pensions. I introduced to the Chancellor of the Exchequer, before he became Prime Minister, a deputation representing railway companies, the British Banking Association, and various manufacturers and others, and on that deputation the evidence was very striking that where superannuation funds had been at work for some little time, in some cases not one single member of the fund came upon the Old Age Pension, because the weekly income exceeded the limit, and, of course, on similar grounds there is considerable relief in regard to the Poor Law. I recognise that the Government have made a number of concessions this year. It may be that they cannot see their way to making an additional concession, but on the broad ground of encouraging thrift, even by a taxing Act, if it can be done at a small cost, it ought to be done. I recognise that a taxing Act should not be a vehicle, so to speak, for general legislation or social reform, but a small exemption of this kind has a really valuable social effect.

Sir J. GILMOUR: I beg to second the Motion.

Sir W. JOYNSON-HICKS: I am sorry to have to tell my hon. and learned Friend that we are not able to accept the Clause for the moment. It raises
rather an extension of the original Clause which, through his instrumentality, was passed the year before last. I also had something to do with the inception of that Clause, and I have a good deal of sympathy with this Clause, but it is an extension of the original one, and it would involve a further call on the Exchequer, and as we have made a good many concessions during the last 24 hours, I hope my hon. and learned Friend will not press it to a Division.

Motion and Clause, by leave, withdrawn.

NEW CLAUSE.—(Relief in respect of Super-tax on reserves of an individual carrying on a trade, business, profession, or vocation either by himself or in partnership).

For the purpose of computing super-tax in the case of any individual carrying on a trade business, profession, or vocation either by himself or in partnership, application may be made in writing to the Special Commissioners by the individual or the partnership on behalf of the partners, as the case may be, to have the provisions of this Section applied to the individual or to the partners in respect of any year of assessment.
If the applicant shows to the satisfaction of the Special Commissioners that a reasonable part of the actual income of the trade, business, profession, or vocation from all sources for the year preceding the year of assessment has been withdrawn by the owner or distributed to the partners of that trade, business, profession, or vocation, the Special Commissioners shall decide that the amount to be included for assessment to super-tax shall be the amount so withdrawn or distributed during the period of one year next before the year of assessment, as shown by the accounts of the trade or business for accounting periods, ending on a date prior to the fifth day of April next before the year of assessment.
In the case of a partnership the amount distributed from the business shall be deemed to be apportioned to the partners for the purposes of this Section in the proportions in which the partners are entitled to divide the profits of the partnership.
Any sum withdrawn by way of loan from a partnership by any partner during the said period prior to the year of assessment shall for the purposes of this Section be regarded as income of the partner during that period.
Provided that—
If and when such loan is repaid to the partnership a croresponding set-off against the income of the partner for the year in which repayment is made shall be allowed for the purposes of this Section.
If either the applicant or the Commissioners of Inland Revenue are dissatisfied with the determination of the Special Commissioners on any applica-
tion under this Section they may, on giving notice to the clerk of the Special Commissioners within twenty-one days after the determination, require the application to be reheard by the Board of Referees and the Special Commissioners shall transmit to the Board any document in their possession which was delivered to them for the purpose of the application.
The Board shall re-examine the application and shall have and exercise the same powers and authorities in relation to the application as the Special Commissioners might have and exercise, and the determination of the Board thereon shall be final and conclusive.—[Mr. Dennis Herbert.]

Brought up, and read the First time.

Mr. D. HERBERT: I beg to move, "That the Clause be read a Second time."
This is a very long Clause, but I can move it in a speech which is not longer than the Clause itself. Last year there was a very drastic Clause in the Finance Bill in connection with preventing people from evading taxation by the formation of one-man companies. It was recognised that if a man formed his business into a limited company it was not fair that he should have Super-tax levied on the gross profits, as we may call them, which he was practically obliged to put back into the business. That was the accepted view of the Government and that was provided for in the Clause. My Clause is really to put on exactly the same footing a man who does not turn his business into a company, but continues to carry it on either by himself or in partnership. I have some reason to suppose it is not looked upon with disfavour by the Government and by the Revenue authorities. It is true it would no doubt reduce, in the first instance, at any rate, the yield of the Super-tax, and if my right hon. Friend says he cannot accept it this year I shall realise, as a supporter of the Government, that one cannot press on them a Clause which is going to upset their financial arrangements for the year, but I hope he will be able to say the Clause is a reasonable one, framed in such a way as to carry out what might reasonably be carried out another year if it is considered by the Chancellor when framing his Budget.

Lieut.-Colonel NALL: I beg to second the Motion.

Sir W. JOYNSON-HICKS: I am very much obliged to my hon. Friend for saying that he would not press this Clause
if I told him that it would make a considerable inroad into our taxes for the current year. That saves me from arguing the Clause. I am afraid I do not take quite such a favourable view of it as the hon. Member does. It would need a really considerable argument to discuss it in full, but the one objection, which will be conclusive to the hon. Member and the House at the present moment, is that it might cost anything up to £3,000,000 a year. Of course, therefore, it is impossible, at the present stage of the Finance Bill, to accept a proposal which would create such havoc. I shall be very glad if the hon. Gentleman will withdraw the Clause.

Mr. HERBERT: After what the Financial Secretary has said, I beg to ask leave to withdraw the Clause.

Motion and Clause, by leave, withdrawn.

NEW CLAUSE.—(Entertainments Duty.)

After the first day of May, nineteen hundred and twenty-three, Entertainments Duty within the meaning of The Finance (New Duties) Act, 1916, as amended by any subsequent enactments, shall not be charged on payments for admission to any school athletic sports where the competitors are over eighteen years of age if the competitions open to such competitors are reserved for old boys of the school holding such sports.—[Mr. Mosley.]

Brought up, and read the First time.

Mr. MOSLEY: I beg to move, "That the Clause be read a Second time."
This Clause speaks for itself. It is a very simple proposal to exempt from the Entertainments Duty any school sports at which a competition is held confined to old boys of that school. In the present state of the law, if a school has a race for boys over 18, even though they be late pupils of the school, it becomes liable to the Entertainments Duty. I hope the right hon. Gentleman may see his way to accept the Clause.

Mr. OLIVER: I beg to second the Motion.

Sir W. JOYNSON-HICKS: I am delighted to think of the hon. Member for Harrow (Mr. Mosley) going back, as an old boy, to take part in the over 18 race, and of the great entertainment it might be, and I will not charge a tax upon it. I am going to be even kinder than the hon. Member asks. If he goes back and
sings a song at his school, that also ought to be exempted from the Entertainments Duty. I propose to accept the Clause. There are one or two verbal Amendments which I shall move, which will really extend the proposal, and will, I think, go a long way towards meeting the case which the hon. Member for Pontypool (Mr. T. Griffiths) put this afternoon. He asked me if I could do something in this direction, and I think this Clause will meet his wishes, also.

Question, "That the Clause be read a Second time," put, and agreed to,

Clause read a Second time.

Amendment made: Leave out the words, "After the first day of May, nineteen hundred and twenty-three," and insert, instead thereof the words
Notwithstanding that any of the persons taking part as performers in the entertainment are persons of the age of eighteen years or upwards."—[Sir W. Joynson-Hicks.]

Sir W. JOYNSON-HICKS: I beg to move to leave out the words
athletic sports where the competitors are over eighteen years of age if the competitions open to such competitors are reserved for old boys of the school holding such sports,
and to insert instead thereof the words
entertainment in the case of which the Commissioners of Customs and Excise are satisfied with respect to all the matters other than the age of the performers mentioned in Section twelve of the Finance Act, 1916.
This is to cover other things than athletic sports.

Mr. MOSLEY: Thank you very much. Amendment agreed to.

Clause, as amended, added to the Bill.

NEW CLAUSE.—(Relief in respect of error or mistake.)

(1) If any person who has paid tax charged under an assessment to Income Tax made for any year under Schedule D, or according to the Rules applicable to that Schedule, alleges that the assessment was excessive by reason of some error or mistake in the return or statement made by him for the purposes of the assessment, he may, at any time not later than three years after the end of the year of assessment within which the assessment was made, make an application in writing to the Commissioners of Inland Revenue for relief.

(2) On receiving any such application the Commissioners of Inland Revenue shall
inquire into the matter and shall, subject to the provisions of this Section, give by way of repayment such relief (including any consequential relief from Super-tax) in respect of the error or mistake as is reasonable and just.

Provided that no relief shall be given under this Section in respect of an error or mistake as to the basis on which the liability of the applicant ought to have been computed where the return or statement was in fact made on the basis or in accordance with the practice generally prevailing at the time when the return or statement was made.

(3) In determining any application under this Section the Commissioners of Inland Revenue shall have regard to all the relevant circumstances of the case, and in particular shall consider whether the granting of relief would result in the exclusion from charge to Income Tax or Super-tax of any part of the profits or income of the applicant, and for this purpose the Commissioners may take into consideration the liability of the applicant and assessments made on him in respect of other years.

(4) Any person who is aggrieved by the determination of the Commissioners of Inland Revenue on an application made by him under this Section may, on giving notice in writing to those Commissioners within twenty-one days after the notification to him of their determination, appeal to the Special Commissioners.

(5) The Special Commissioners shall thereupon hear and determine the appeal in accordance with the principles to be followed by the Commissioners of Inland Revenue in determining applications under this Section and, subject thereto, in like manner as in the case of an appeal to them against an assessment under Schedule D, and the provisions of the Income Tax Acts relating to such an appeal (including the provisions relating to the statement of a case for the opinion of the High Court on a point of law) shall apply accordingly with any necessary modifications.

Provided that neither the appellant nor the Commissioners of Inland Revenue shall he entitled to require a case to be stated for the opinion of the High Court otherwise. than on a point of law arising in connection with the computation of profits or income.—[Sir Henry Buckingham.]

Brought up, and read the First time.

Sir HENRY BUCKINGHAM: I beg to move, "That the Clause be read a Second time."
I think it would be unnecessary for me to detain the House on this matter, as the subject-matter of the Clause was fully discussed in Committee. But I may mention that the Clause had the approval of both sides of the House, and the Financial Secretary referred the matter to the late Attorney-General (Sir E. Pollock) to
draft a Clause, which is rather a difficult one. The result of these negotiations is that the Clause, which stands in my name and in the name of other hon. Members, has been drafted. It will not offend the susceptibilities of Somerset House, and I hope the Government will see their way to accept it as it stands. I would only like to say that it will be noticed that in this somewhat experimental Clause reference is only made to cases under Schedule D, but if the Clause proves successful in obtaining justice for the taxpayer next year it may be possible to extend the provisions to cases under Schedule E.

Mr. D. HERBERT: I beg to second the Motion.
I hope this Clause may be accepted. I might describe it as introducing for the first time a principle of justice to which the taxpayer is entitled. It is a very difficult point to deal with. I do not want to be hard on the Inland Revenue, but I hope that, as time goes on, we may be able to get a good working system under which the taxpayer will have what one may describe as equal rights with the tax collector in regard to rectifying cases of over-assessment.

Sir W. JOYNSON-HICKS: I am delighted that the last new Clause put down on the Paper is one which I can accept. The House may recall that on the Committee stage requests came from all parts of the Committee that a means of appeal should be provided for the Income Tax payers who have been over-
assessed. The late Attorney-General (Sir E. Pollock) made that appeal, and I asked that he should consult me in regard to the drafting of a Clause which would be fair to the Inland Revenue and to the Income Tax payer. My right hon. and learned Friend has been kind enough to consult me, and he gave a good deal of time to the Clause. It may not meet the wishes of every Member of the House, but it is a very great extension of the right of appeal to the subject. It is a matter in which I feel interested, and I am very glad to be able to accede to the request. The Clause really does introduce a new principle in Income Tax by giving the subject a right of appeal in regard to over-assessment.

Clause read a Second time, and added to the Bill.

Ordered, "That further Consideration of the Bill, as amended, be now adjourned."—[Colonel Leslie Wilson.]

Bill, as amended, to be further considered To-morrow.

The remaining Orders were read, and postponed.

It being after Half-past Eleven of the Clock upon Monday evening, Mr. SPEAKER adjourned the House, without Question put, pursuant to the Standing Order.

Adjourned at Eighteen Minutes after Twelve o'Clock.